Advantages of Investing in Properties Through a Corporation (Country Chile)

By Jaime Hernandez

Advantages of Investing in Properties Through a Corporation (Country Chile)

By Jaime Hernandez

Available to assist with the property purchase process for individuals living outside of Chile interested in investing or living in Chile, the focus of this blog.

When acquiring more than two properties for investment, it’s advisable to do so through a corporation to take advantage of various tax benefits, such as deducting expenses from the taxable base of income tax, among others.

ADVANTAGES OF INVESTING IN PROPERTIES THROUGH A CORPORATION

When investing in properties under this framework, it is ideal to do so through a form known as a Sociedad por Acciones (SpA).

Introduced into the Commercial Code through Law 20.190 in 2007, it has become the preferred option for various types of ventures. In 2018, it represented 52% of the companies established nationwide.

In the real estate sector, it offers significant benefits:

CAN BE FORMED WITH A SINGLE SHAREHOLDER

In general terms, a SpA is a type of capital company formed by one or more individuals, natural or legal entities, with shares divided and limited based on their capital contributions. Unlike a limited liability company, which requires 2 to 50 partners, for example.

This means that anyone wishing to invest in properties while enjoying the advantages of doing so through a corporation can do it alone, without needing a third party for this purpose, and can later add shareholders as the investment grows, if desired.

2. BROAD CORPORATE PURPOSE

The SpA allows for the inclusion of multiple economic activities, which is not permitted in an Individual Limited Liability Company. This facilitates the generation of additional income under the same entity. In addition to investing in properties, you can also channel financial investments, allowing for a more comprehensive vision, such as an investment company, in the broad sense of the term.

3. EASY TO IMPLEMENT

Investing in properties through an SpA is straightforward because the incorporation process is quick and easy. You can do it through the “Start Your Company in a Day” portal, and it does not require a public deed.

However, it is also possible to incorporate it in a traditional manner with the assistance of a lawyer, as beyond the incorporation itself, this type of corporation requires the formalization of the administration of the company and other important details.

4. VERSATILE AND SCALABLE

The Sociedad por Acciones is highly flexible, as it is regulated by the shareholders’ specifications in the bylaws, adapting to the administrative regulations of joint-stock companies or limited liability companies. If the real estate investment grows over time, it is possible to formalize its operation as joint-stock companies do, without being directly supervised by the Superintendency of Securities and Insurance. Additionally, new shareholders can be added easily; you only need to sell shares, and you don’t have to amend the bylaws, as is the case with Limited Liability Companies.

5. LIMITED LIABILITY

In the SpA, each shareholder is responsible for the capital they contribute. In this sense, if for some reason the business fails to meet its obligations, creditors cannot take legal action against the personal assets of the partners.

Undoubtedly, it is a great option for investing in properties and can also serve as a tool for estate and family planning.

Please let me know if you need any further adjustments or if you have any other questions.

By Jaime Hernández on November 4, 2023.

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Exported from Medium on March 15, 2025.