Tax
SAT administration, 30% corporate rate and 16% VAT
The Servicio de Administración Tributaria administers federal taxes. Corporate income tax is a flat 30%, individuals are taxed progressively to 35%, and VAT is 16% with a reduced 8% band in the northern and southern border zones. Electronic invoicing through CFDI is compulsory for essentially every transaction.
Key rules
- Residents are taxed on worldwide income; non-residents on Mexican-source income only.
- Every invoice must be a digitally stamped CFDI, now in version 4.0; an expense without a valid CFDI is not deductible.
- Annual individual returns are due by 30 April, corporate returns by 31 March.
- Transfer pricing follows OECD principles, with local and master file obligations for larger groups.
- Reportable-scheme disclosure obligations apply to advisers as well as taxpayers.
Governing law
- Ley del Impuesto sobre la RentaIncome tax.
- Ley del Impuesto al Valor AgregadoVAT.
- Código Fiscal de la FederaciónProcedure, audits and electronic invoicing.
In practice
An e.firma and a Buzón Tributario mailbox are prerequisites for almost all filings; SAT notifications delivered to the mailbox are legally effective. Blacklisting under Article 69-B for simulated operations is a serious practical risk for suppliers.