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Got Questions? Dear Mextax Answers…

This week, we answer a question regarding a Mexican corporation that is not generating any income or expenses yet.

Dear Mextax,

I created a Mexican corporation to purchase a piece of land in Sayulita. We plan to build a building with two to three rental units, but we are not planning on doing that at least two more years. The company isn´t earning any income and doesn´t have any expenses. Do I need to worry about working with an accountant right now?

Mexican tax law requires corporations file monthly declarations with SAT (Servicio de Administración Tributaria), Mexico´s tax authority. It also requires that those declarations begin the same month that the company is incorporated, even if there are no income or expenses. For example, if the official incorporation date of your business is September 13, 2018, your accountant will file your monthly declarations starting with September 2018. If you are not operating and have no income and no expenses, they file your declarations `in zeros´. This will keep your status with SAT current and avoid any late fees or fines for not properly filing.

A qualified Mexican accountant will walk you through the entire process when you start a corporation. They will also ensure that you stay current with SAT and avoid late fees and fines. Our team at Mextax has both the knowledge and the experience to assist you with any questions and concerns you have.

Please contact us for more information about how we can help you and your business succeed in Mexico.