1. What is an RFC?
It is the tax identification number in Mexico. RFC stands for Federal Taxpayers Registry. It identifies the contributors that carry out commercial activities, whether this is done as an individual or as corporation. The RFC number can be obtained only with Mexican residence or the incorporation of a Mexican company.
2. If I pay taxes in Mexico do I also have to pay them in my country?
Not necessarily. There are several treaties in Mexico and other countries to avoid paying the same taxes twice. Contact us for more information.
3. Once I have created my Mexican company, what fiscal obligations do I have?
- Register at the RFC if you have not already.
- Request the FIEL (the Advanced Electronic Signature). We can assist you in this process.
- Issue CFDI – facturas (electronic invoices).
- Use an Electronic Accounting System, according to the stablished in the CFF rules (Federal Fiscal Code) with capacity to generate XML.
- Submission of provisional or definitive payments of certain taxes.
- Submission of provisional taxes and annual corporate statement.
- Submission of DIOT (Informative Statement of Third Parties Operations) if you are subject to VAT (Value Added Tax).
4. What taxes are paid in Mexico?
The federal taxes are: IVA or Vat (Value Added Tax) equal to 16% and the ISR tax (Income Tax) equal to 30%. These are the taxes every commercial activity provider must pay.
There are also state taxes that must be covered according to the activity of each enterprise, like the payroll tax if there are any employees, or the lodging tax if lodging activities are carried out.
5. How frequently are corporate statements made?
Monthly statements and payments must be carried out, along with an annual statement.
6. If I have an enterprise in Mexico but it is not active yet, should I make a corporate statement?
Yes. Even when the company is not generating income or expenses, the statements must be made in a timely manner to avoid any penalty from the authorities.
7. Does Mextax pay taxes for me?
No. Once the statement is done, your enterprise accountant notifies you whether you must pay taxes or not, and the company administrator should carry out the payments.
8. Can I make the statements myself or should I hire an accountant?
The most advisable thing is to hire an accountant, especially if you are a foreigner and do not have knowledge of Mexican fiscal laws. An accountant will make sure the accounting is registered the right, legal and practical way. An accounting team can help you reduce the tax payment making deductions and find potential problems.
9. Are all my enterprise’s expenses tax deductible?
Yes, if they are related to the company’s activities and a CFDI (electronic invoice) has been issued for such expenses.
10. What happens if I stop using my Mexican company, should I liquidate it?
Not necessarily. You can also suspend it for up to two years.
11. What is the e.firma (electronic signature of the corporation) ?
e.firma stands for Firma Electronica Avanzada. The Firma Electronica is a fairly recent addition to the Hacienda requirements.
The purpose of the FIEL is to allow taxpayers to access their information, submit declarations and make transactions online in a safe, private manner.
Some of the transactions available using your FIEL:
– Customs documentation
– Fiscal documents