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09.09.2022

Chile: Global mobility in Chile

For more than a decade, Chile has constantly received foreign executives. This is directly related with the high salaries of Chile, among the highest in Latin America, and therefore it is convenient for international executives.

Currently, there is an inflation rate of more than 10% (the highest in 14 years), the crisis due to the pandemic continues to affect the country, the Chilean Peso has devaluated compared with the US dollar and there is a new migration regulation, among other situations. Even though these changes have occurred in the last months, the country is still well positioned worldwide and attractive for foreign investments and for doing business locally and with neighbouring countries. There are new possibilities for career developments, voluntary assignments and assignments for specific projects, which motivates the companies to hire foreign executives.

This way, foreign professionals and technicians who seek to take a stance in different markets have arrived in the country. Local companies can create attractive working environ­ments in which the diversity of knowledge and culture are essential values. The intention to reduce costs, access to talent or improve the operational efficiency are also considered. The transfer of knowledge, experiences and good practices between branches, in general, are added as an advantage of the multinational companies based in the country.

This process applies to confront labour and migration challenges, along with complying with tax obligations considering the different jurisdictions in which the companies that hire foreign employees to their payrolls operate.

Therefore, the role of local advisors is to collaborate in a problem-free transition that benefits the company and the expatriate who is migrating. To help them get to know and understand the culture, the labour laws, tax compliances, applicable visas and family installation process, special support needs to be provided before the arrival of the foreign executive.

The advice is bespoke to the company and for the expatriate who will need to understand tax laws in the country, and how the rules of the new country interact with the laws of the country of origin and vice versa, in case the employee returns to the country of origin. It is crucial to also consider advice in the event that the employer decides that the foreign employee should become a local employee in Chile.

The services that support global mobility include tax and labour advice for individuals transferred into and outside of Chile and are part of a plan that must consider the evaluation of the tax residency, advice on the monthly and annual tax returns, analysis of social security and pension issues, assessing the tax implications related to stock-based incentive plans for both local employees and international assignees and advice on compliance with tax obligations in the country of origin and in Chile.

We are facing the challenges of the globalisation of markets, and therefore also companies with an international presence and their advisors must plan strategically to guarantee success for the global mobility of jobs, people and knowledge.

Read the WTS Global Mobility Newsletter here.

Article published in Global Mobility Newsletter #1/2022
Brief overview of recent or expected changes in the area of Global Mobility
View publication
Newsletter Global Mobility

With this newsletter we give an overview of recent or expected changes in the area of Global Mobility in different countries.

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