Fiscal Address Services – When Simple Things Go Wrong

Every single company based and operating in Chile needs to have a registered fiscal address with local Tax Authorities; it is that simple.

We have seen over the years how other Back-Office Providers offer “solutions” that are far from ideal:

Engaging third parties to provide the service: In this scenario, the local Back-Office Provider will use and sell to the international client not its own address, where its offices are physically situated, but that of a third local party with offices elsewhere. It is pretty evident that this arrangement brings to the table a series of problems and challenges:

1. The reception, tracking, and custody of important correspondence is sketchy and subpar, as these third parties act as Virtual Offices, meaning they sublease the office to hundreds, if not thousands, of other companies. They are usually very understaffed, which translates into mistakes, poor registrations, and ultimately, documents and envelopes being lost or handed to other companies.

   
   

2. Said Virtual Offices have short opening hours, typically 9 am to 5 pm, with one hour lost at lunchtime, meaning correspondence coming in from overseas at off-hours will not be received and will eventually find its way back to the nearest distribution center.

   
   

3. Most of these Virtual Offices do not offer the option to store merchandise, boxes, or any other object larger than an envelope, and those that do, would you really want to risk it?

   
   

4. In Chile, the registered address plays a key role and affects a company's ability to invoice. Having one at a Virtual Office considerably complicates all invoicing authorizations and processes, creating significant delays that affect business. (Tax Authorities have them completely identified)

   
   

5. Back-Office Providers who opt for this model apply hefty markups to foreign clients, who end up paying much more for poor service.

   
   

Using their own commercial address: On paper, this looks great because it resolves all the previous points and problems, BUT there is an important catch: Most medium- to small-sized Back-Office Providers in Chile operate on a hybrid system, meaning there are days when nobody is at the office. We have seen firsthand how envelopes sent by clients overseas are lost because there is simply nobody at the office to receive them, nor is there any basic contingency plan in place. Furthermore, and more critically, some Back-Office providers do not have real seniority or Office Managers in place, so there is no one to actually oversee administrative tasks such as this. It is quite shocking, really, how some Back-Office providers have their offices “run” by managers located elsewhere, or even worse, by junior accountants, creating an array of problems. This is just one of them.

At South Gate, we offer a third BETTER option that ensures the fiscal address service is properly provided:

1. We provide our own address located in the heart of the Las Condes Commune.

2. We have a qualified and bilingual receptionist in place.

3. If the courier arrives after business hours, we are authorized to receive the envelope/merchandise in a secure space at the building´s administration office.

4. We offer the option to store merchandise and valuables at no extra cost.

5. We offer Lower fees as the service is provided completely in-house.

6. We have Senior Professionals located at the Santiago Office to ensure oversight.

Author: Allan Schulder – Co-Founder & CEO at South Gate Advisory