Chile Forum

I found a good deal on a nice furnished house, but someone just told the person who owns the house they need to pay IVA tax since they're renting it furnished. So the good deal just got about 20% less good, and I have a couple questions.

1) What's the legal definition of "furnished". I'm wondering if they just locked a bunch of stuff in one of the rooms I won't be using, would I be able to turn it into an unfurnished rental?
2) When exactly does this IVA tax apply to a rental? I remember (but my memory isn't that great) reading that it only applies in the summertime to tourist rentals.

Or if there's already a thread that talks about this, can someone post a link? Thanks!

only ilegal if you get caught ......
90% of places i bet do not declare it....

zer0nz wrote:only ilegal if you get caught ......

I had a friend way back in junior high school who used to say that. Your name isn't Dennis is it?

zer0nz wrote:90% of places i bet do not declare it....

And I manage to find the one out of 10 that does

Another trick which I have seen being used, is to separate the rental of the house and furniture in two contracts, whereby only the furniture rental pays IVA.

thisisreallycomplicated wrote:I found a good deal on a nice furnished house, but someone just told the person who owns the house they need to pay IVA tax since they're renting it furnished. So the good deal just got about 20% less good, and I have a couple questions.

1) What's the legal definition of "furnished". I'm wondering if they just locked a bunch of stuff in one of the rooms I won't be using, would I be able to turn it into an unfurnished rental?
2) When exactly does this IVA tax apply to a rental? I remember (but my memory isn't that great) reading that it only applies in the summertime to tourist rentals.

Or if there's already a thread that talks about this, can someone post a link? Thanks!

Some places charge the IVA then pocket it, the reason for the IVA (I have been told) is aimed more towards furnished short term rentals not yearly leases, I don't charge IVA in a furnished house I lease year by year as my accountants says I don't need to, but the place has a large deposit for the furniture and the rent includes wear and tear.

Thanks for the help. It looks like the IVA tax doesn't apply in my situation, and hopefully the owner will understand that. And I was a little suspicious of the owner charging it, then pocketing it. But it was probably just an honest mistake.