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Get $40k grant for your startup. Live in Chile for 6 months.

startupchile.org

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Re: Get $40k grant for your startup. Live in Chile for 6 months.

#51

Post by herval »

gcb wrote: post #46
herval wrote: post #27

Earlier quoted context omitted.

you can only spend 350k pesos per founder, from those 40k. The rest should be used for other expenses, such as hiring, software (housing/rent is also refundable outside the 350k cap), etc. 350k pesos = 760 usd/month, which allows for some pretty ok living (a decent meal runs for 3-4k pesos, subway tickets are 500 pesos and so on). I'm here with my wife, there's a guy here with SEVEN kids. :)

3-4k pesos per meal is already over 500k for one month, two people. meal price * people * two meals day * 30 days 3k * 2 * 2 * 30 = 360k other comments mention rent $300 (150~200k pesos?)

rent is not on that 350k limit (u can spend up to 600k a month in rent, which is enough for a pretty nice place - I currently pay 300k and live in the trendiest city in town)

if you're bringing family here, don't expect to be able to feed everyone on restaurants two times a day, every day of the week. That's impractical on basically ANY city, if you have a family. Alas, if you're planning that, you should not even be considering bootstrapping....

Re: Get $40k grant for your startup. Live in Chile for 6 months.

#52

Post by herval »

gcb wrote: post #24
funthree wrote: post #10

I got a survey from these guys a few weeks ago and it had cc'd over 400 applicant emails, including mine, for all to see.

looking at the web site some time ago also gave me the impression it's not thatwell planed prices. lots of missing info. no wonder every thread about it raises the same basic questions.

it's also the first group (there was a beta last year), so it's not exactly a "long planned, flawless program". They call it an EXPERIMENT for a reason: come with an open mind and you'll definitely grow. Come full of "it doesn't work like that back home" and all you gonna find is frustration. Just my opinion, anyway. :P

Re: Get $40k grant for your startup. Live in Chile for 6 months.

#53

Post by Futur1st »

When I first heard about this a few months back I was somewhat skeptical, but it seemed like a great idea. It's nice to see a Gov't that doesn't have its head firmly lodged up its own ass and one that is trying different approaches to attracting business. From the other comments it seems as though it's working out pretty well- When I can no longer take anymore of the politics and RIDICULOUS politicians here in the States, Chile could be a good place for the next adventure...

Re: Get $40k grant for your startup. Live in Chile for 6 months.

#54

Post by econgeeker »

bugsy wrote: post #45
andrewcooke wrote: post #38

Earlier quoted context omitted.

[having problems with hn slow response] see http://www.quora.com/Hows-life-in-Santiago-Chile for more background. i am here because my partner is a chilean academic with tenure here. in general, it's a good place to live. personally, i am not the most outgoing or relaxed person on the planet, and sometimes living in a different culture - and it could be any other culture - gets to me. but the only negative thing i ca…

Should be noted, the taxes in Chile are not only lower than Europe, they are also lower than in the US unless you are a member of the ultra elite rich that has a team of tricky accountants who shuffle assets to remote islands to make sure you don't pay your share. How can they do it? Well they don't maintain a global imperialist war machine that costs trillions to maintain, nor do they give away trillions to criminal…

I don't have an authoritative source, but I recently read that Chile assesses: - Up to %40 income taxes - A form of social security taxes - taxes capital gains as income - %17 corporate taxes - %19 VAT Taxes (might have that and corporate reversed) and, the piece de resistance: - a %35 excise tax on taking money out of the country!

Re: Get $40k grant for your startup. Live in Chile for 6 months.

#55

Post by andrewcooke »

econgeeker wrote: post #54
bugsy wrote: post #45

Earlier quoted context omitted.

Should be noted, the taxes in Chile are not only lower than Europe, they are also lower than in the US unless you are a member of the ultra elite rich that has a team of tricky accountants who shuffle assets to remote islands to make sure you don't pay your share. How can they do it? Well they don't maintain a global imperialist war machine that costs trillions to maintain, nor do they give away trillions to criminal…

I don't have an authoritative source, but I recently read that Chile assesses: - Up to %40 income taxes - A form of social security taxes - taxes capital gains as income - %17 corporate taxes - %19 VAT Taxes (might have that and corporate reversed) and, the piece de resistance: - a %35 excise tax on taking money out of the country!

tax on earnings are listed here - http://www.sii.cl/aprenda_sobre_impuestos/impuestos/imp_dire... - and the 40% rate applies to earnings over $12,500 a month (it's banded). there are also incentives for investment that count against that (so you invest the money in a pension fund, say, then that lowers your effective wage for tax purposes, i think (not completely sure)).

the 35% tax is described here - http://www.sii.cl/portales/inversionistas/imp_chile/impuesto... - and applies to earnings of people who don't live or have residence in chile. so it wouldn't apply to someone under this grant. also, it's not in addition to other taxes (so it's 18% over VAT, if that would have been charged - again, this is just from skimming the docs).

[edit: you need to translate the fourth paragraph to understand the "additional" nature. here's a link in english http://www.thisischile.cl/frmContenidos.aspx?SEC=187&ID=... that says This tax applies to those who are neither residents nor residing in Chile and ranges between zero and 35% on total revenue depending on the type of income (e.g., for services, royalties, interest, transportation payments, insurance, capital gains, and dividend distributions). In the case of utilities, the “First Category” tax can apply as a credit towards the additional tax.]

in general, chilean laws and taxes are all described online. you don't need to post uninformed speculation - you can search for the details. disclaimer: i just skimmed the links, and am no expert, so my summary may be incorrect.

Re: Get $40k grant for your startup. Live in Chile for 6 months.

#56

Post by runT1ME »

40k for six months of my life in an area where I don't have a lot of familiarity or a network of business associates or friends isn't a great deal.

Six months of my life to win a contract with the Chilean government to use my software, and I'm sold. How much support or networking is done by the program? Is it pretty much you get the money and you're on your own in a foreign country?

Re: Get $40k grant for your startup. Live in Chile for 6 months.

#58

Post by HistoryInAction »

runT1ME wrote: post #56

40k for six months of my life in an area where I don't have a lot of familiarity or a network of business associates or friends isn't a great deal. Six months of my life to win a contract with the Chilean government to use my software, and I'm sold. How much support or networking is done by the program? Is it pretty much you get the money and you're on your own in a foreign country?

The first class met with Dave McClure and the Chilean President as part of one of Dave's Geeks on a Plane visits to South America recently.

Looks like they do a fair bit of networking.

Re: Get $40k grant for your startup. Live in Chile for 6 months.

#59

Post by Okvivi »

I wonder what the internet penetration, internet speed and mobile penetration is in Chile. Do they see this as something that would directly benefit Chile through the products or something that would just create a pool of people and ideas that would indirectly improve the startup environment in Chile.

And then the broader question in my mind is: can you build a successful US focused startup from somewhere else? Aren't the first six months some of the most critical stages of your product development where you have to be close to your users and understand their needs well?

Re: Get $40k grant for your startup. Live in Chile for 6 months.

#60

Post by econgeeker »

andrewcooke wrote: post #55
econgeeker wrote: post #54

Earlier quoted context omitted.

I don't have an authoritative source, but I recently read that Chile assesses: - Up to %40 income taxes - A form of social security taxes - taxes capital gains as income - %17 corporate taxes - %19 VAT Taxes (might have that and corporate reversed) and, the piece de resistance: - a %35 excise tax on taking money out of the country!

tax on earnings are listed here - http://www.sii.cl/aprenda_sobre_impuestos/impuestos/imp_dire... - and the 40% rate applies to earnings over $12,500 a month (it's banded). there are also incentives for investment that count against that (so you invest the money in a pension fund, say, then that lowers your effective wage for tax purposes, i think (not completely sure)). the 35% tax is described here - http://www.sii…

"Additional tax applies to income derived from Chilean sources by individuals or entities not domiciled or resident in Chile, where the income is available from Chile to the person residing abroad. Dividends, withdrawals and / or repatriation of profits by corporations, partnerships or permanent establishments of foreign companies are taxed at the general rate of 35% additional tax."

Note the word "additional". So, this implies after regular corporate taxes are applied.

So, you form a corp in Chile under this program, then you leave after 6 months. You're no longer a resident of chile. You want to take your companies profits out of chile, then this tax would be applied. Depending on the industry, and the corporate tax rate, it looks like it could be as much as %52! (%35 plus corporate taxes.)

This is actually one of the key indicators of a regime that you should be wary of. Currency controls are what governments impose when they find their policies are driving businesses out of the country. I'm not saying that is the situation in chile, I'm just saying that this is the historical role these kinds of taxes have played.

This tax, and the others I mentioned are confirmed by the links you gave, so it is wrong to claim they are "uninformed speculation". Turns out I was quite well informed!

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