The Chilean Internal Revenue Service (SII) established new requirements for the issuance of invoices and other electronic tax documents (DTEs) through Exempt Resolution No. 36 dated March 15. 

The DTEs subject to this change are: invoices, credit notes, debit notes, delivery notes, purchase invoices, and invoice settlement documents.

The new requirement is that the description of the goods or services must clearly, formally, and explicitly identify the products sold or services rendered, using Spanish-language words in their natural meaning and avoiding abbreviations that hinder understanding, although internal coding is allowed. 

The description of the goods or services must be included in the “Item Name” or “Product Name” field in the DTE “Detail” section. If the description exceeds 80 characters, it must continue in the “Additional Description” or “Descr.” field on the same line.

According to the SII, non-compliance with this new obligation, as well as malicious use of the Electronic Invoicing System, will be sanctioned under Article 97 No. 10 of the Tax Code (fines and closure). 

On the other hand, a purchaser that receives an invoice that does not comply with the new requirement runs the risk of losing the right to VAT input tax credit pursuant to Article 23 No. 5 of the VAT Law. This rule results in the loss of VAT input tax credit in cases where invoices do not comply with legal or regulatory requirements, as would be the case here. 

This resolution will enter into force on July 1, 2024.

This new regulation will require taxpayers to review their DTE issuance and receipt processes in order to avoid sanctions and risks.