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Mexican Tax Structure

There are numerous and complex tax structures in Mexico that can quickly become overwhelming and confusing. First knowing what to expect, then how to navigate possible issues, is well worth the knowledge of hiring a certified professional.

In Mexico, past or current unpaid taxes do not necessarily follow the corporation or person selling the property. If left undisclosed or undiscovered, these past or current unpaid taxes will remain attached to the property, and will therefore become the responsibility of purchaser.

Even if the purchase does not include the purchase of the corporation or other entity previously associated with the property, the unpaid taxes will remain attached to the property.

This is an abbreviated list of some tax issues you'll encounter while doing business in Mexico.

Corporate

IVA ( Impuesto al Valor Agregado ) Value Added Tax -10% Sales Tax - paid montly
ISR ( Impuesto Sobre la Renta ) - Income Tax paid montly 
IETU ( Impuesto empresarial a tasa única ) - montly Federal Tax
Retención de Impuestos - Tax withholdings for personal or professional services
Retencion ISR
Retencion IVA

Employee

Hiring Employee's in Mexico
IMSS ( Instituto Mexicano del Seguro Social ) - Social Security Tax
Infonavit ( Instituto del Fondo Nacional de la Vivienda para los Trabajadores )
Mexican Institute of National Workers' Housing Fund
ISPT ( Impuesto Sobre Productos del Trabajo ) - employee wage tax
Impuestos Estatales - Salary Tax
SAR ( Sistema de Ahorro para el Retiro ) - Savings-Related Retirement

Real Estate

1% Property Tax (known as a predial) of the assessed value determined at the time of sale.
The assessed value of the property can be adjusted at a later date if needed.
20% Capital Gain Tax on the gross proceeds from the sales without deductions
This will vary depending on how long the property was held, if a person or corporation is
selling and if a person or corporation is purchasing.

We strongly recommend a comprehensive investigation of every transaction and all parties related to each transaction, to advert unexpected conclusions.

 

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