On January 1st, 2024, the processes for Revaluation of Agricultural real estate and Revaluation of unbuilt sites, abandoned properties or ballast wells located in urban areas came into effect.
The deadline to submit requests for Voluntary Administrative Replacement (RAV for its initials in Spanish) expires on June 19th, 2024.
A. Revaluation of Agricultural Real Estate
According to the information published by the Internal Revenue Service (SII, for its initials in Spanish), a total of 990,951 properties are considered under this classification, of which a total of 175,332 are affected as of the process that began on January 1st, 2024.
It should be noted that as a result of this process, the tax valuation of agricultural properties rose on average by 44%, concentrating mainly in the North of the country, where it is possible to see increases of over 100% in the regions of Tarapacá (170 %), Antofagasta (137%) and Atacama (100%).
In the southern part of Chile, we see increases of 52.4% in the Bío Bío Region, 52.1% in the Ñuble Region, 47% in the Maule Region, 41.2% in the Los Lagos Region and 40.6% in the Rivers Region.
B. Reassessment of unbuilt sites, abandoned properties or ballast wells located in urban areas
A total of 137,535 properties were considered, of which 113,580 are affected, generating an increase of 26.9% in the total Land Tax for this concept.
The main increases in this reassessment process are concentrated in the Los Ríos Region, with 41%; Araucanía Region, with 39.9%; Atacama Region, with 36.2%; and the Metropolitan Region, with 34.2%.
According to the SII, these properties were reported by the different municipalities during November 2023, in accordance with the provisions of Law No. 21,078 on Transparency of the Land Market and Tax on the Increase in Value due to Extension of the Urban Limit. Note that these properties are subject to a surcharge of 100% of the Land Tax, that is, they are taxed with double the ordinary contribution.
As for the most common hypotheses for taxing these lands, there are non-built sites that in past processes were classified as agricultural and that, as a result of the growth and modification of urban areas, are included within the radius and are taxed twice.
Without prejudice to this, it is possible to challenge said classification, for example if the properties are used for the exploitation of agricultural activities (change from Series to Agricultural to modify the appraisal) or if the property, despite being in the urban area, It is outside the coverage area of the public services of drinking water and wastewater collection (allows the elimination of the non-built site surcharge), an issue that must be analyzed on a case-by-case basis.
C. Information process for taxpayers on Real Estate Revaluation
Regarding the information process of the modifications, the Internal Revenue Service sends communications to taxpayers and publishes a Revaluation Letter on its personal website, through which it communicates the variations generated, indicating what the justifications for the increase in contributions would be.
Although, in some cases it has been possible for some time to obtain a tax appraisal certificate with the update of the current values, only in the last few weeks has it been possible to review the details of the information letters with the components of updating the new values.
Without prejudice to this, it should be added that article 6 of the Land Tax Law establishes that an exhibition of roles must be held in a visible place in the respective Municipality for a period of 30 days, a fact that must be communicated through a newspaper. of local or general circulation. This event is of utmost relevance, since once it is concluded, the deadlines to challenge the new appraisals begin to run.
D. Means of challenging the new real estate appraisals
Given that general reassessment processes usually incorporate an increase in the taxable base of the territorial tax, which affects not only ordinary contributions, but also the issuance of supplementary quotas and the Annual Territorial Tax Surcharge of article 7 bis of Law 17,235, the law establishes two major mechanisms for challenging the appraisals reported by the SII.
Among the grounds for challenge are: (i) erroneous determination of surface area; (ii) erroneous application of classification tables, as well as the surface of the different qualities of the land and (iii) errors in transcription, copying or calculation of the appraisal.
As indicated, the calculation of the challenge period is not related to the receipt of the information letter sent by the Internal Revenue Service, but rather to the presentation of roles that is carried out in the respective Municipality.
In the case of the agricultural reassessment processes and non-built sites, the Roles Exhibition began on April 8th and concluded on May 7th, 2024.
The Tax Code establishes two major challenge mechanisms:
1. Administrative: through a Voluntary Administrative Reinstatement Appeal (RAV) before the same SII, within a period of 30 business days counted from the end of the exhibition of appraisal papers in the respective Municipality.
In the case of the 2024 Revaluation processes, this deadline expires on June 19th, 2024.
2. Judicial means: through a presentation in a special procedure to claim real estate appraisal before the Tax and Customs Court in which the real estate is located, within a period of 180 days after the presentation of papers in the respective Municipality.
The period will be 180 days from last May 7th, in the event that no RAV appeal has been filed. Otherwise, its presentation will interrupt the deadline for submitting the claim.
Finally, there is always the possibility of requesting an administrative review of the appraisal of a real estate, directly before the Internal Revenue Service through the presentation of a request using Form 2118, justifying the factors of a nature technician who would make the request appropriate.
Agricultural Real Estate Revaluation Portal: https://www.sii.cl/destacados/reavaluo_agricola/2024
Agricultural goods role display calendar: https://www.sii.cl/destacados/reavaluo_agricola/2024/calendario_exhibicion_agricola_2024.pdf
Revaluation Portal Non-built sites: https://www.sii.cl/destacados/reavaluo/2024/index.html
Role exhibition calendar: https://www.sii.cl/destacados/reavaluo/2024/calendario_exhibicion_roles.pdf
Direct link to access reassessment letters: https://www4.sii.cl/conCartasReaInternet/index.html?carta=notiso
Patricio Casas