Facturas & When You Should Request Them
You may have been to a store, like Office Depot and the cashier asked you ¨Require una factura? (Do you require a factura?). If you do not own a business, you most likely answered no. However, you should know that there may be times you need a factura, and it is important you understand what it is and how it can help you.
What is a factura?
A factura is an electronic invoice issued by a company to their customers for goods and services. This electronic invoice is automatically registered with SAT, Mexico´s tax authority. A company must issue a factura for all income they earn. They may not provide you with a copy automatically, like in a restaurant, but if you request a factura they are required to provide one – regardless of the type of business.
The factura will include details of the transaction such as the amount you paid, including the amount of IVA or sales tax they collected. It will also have detailed information regarding the company, including the legal name and the identifying tax information. It will also outline the services or products provided.
When should I request a factura?
These are the most common scenarios where you should request a factura as an individual:
- Medical Expenses – If you want to have your expenses considered for reimbursement by your Mexican insurance company, you must provide them with a factura.
- Vehicle Purchases – A car´s factura is considered the title of the vehicle and must be given to the owner for all new or used vehicles. You will need this to prove ownership of the vehicle when you register it.If you sell the vehicle, the new owner will expect to be given the factura. Keep this in a safe place – Never in the vehicle!
- Real Estate Transactions – You should request a factura for all real estate transactions. Everything from legal services when you purchased your home, new construction activities, and even home improvements. These facturas will be quite valuable during the sale of the home to be used as deductions if you are required to pay capital gains.
What do I need to provide the supplier to receive a factura?
A supplier may ask for your RFC number (Registro Federal de Contribuyentes) which is similar to your Social Security Number or Social Insurance Number. If you do not have an RFC, a supplier can issue your factura to a generic RFC number used for general purposes.
If you are employed in Mexico, generate income through a rental property, own a business or are thinking of opening a business we can help you. Contact Mextax today for more information about our Mexican accounting services and our available packages.