Mexico

EXPATRIATE AND EMPLOYER TAX COMPLIANCE AND ADVISORY
Tax rate Progressive rate: 1.92% – 35%
Tax period Calendar year
Tax residency / Domicile according to domestic law * If the individual spent more than 183 days continues or not in Mexico in a 12 month period.
* The salary will be paid by or in the name of an employer that is non-resident in Mexico.
* Center of vital interests in Mexico (economic and personal relations)
Tax registration Required if acquired tax residency and also in some cases when in individual is no tax resident.
Employment income definition Any income or benefit earned in cash, in kind, in services or in credits, and income determined by tax authorities on the basis of presumptions. Additionally if a person covers the taxes on behalf the taxpayer, the tax paid is considering income for the taxpayer.
Examples of tax exemption None
Specific expatriate concession None
Income of board members Any remuneration is taxable and the tax withholding is 25% over the income received without any deduction.
Tax returns Obligation to file a tax return not later than April 30th after the year end.
Tax payments Obligation to file monthly tax payment every 17th after the month ends.
TAX TREATIES
Employment income / income from board members Taxable if source is a Mexican corporation.
INTERNATIONAL SOCIAL SECURITY
Cross border employments None
Exception under Art 16 of Reg. 883/2004
and Art 17 of Reg. 1408/71
None
Social Security Cost as % from gross salary and absolute amounts 18% cost for the employer and 7% for the employee based on gross salary.
IMMIGRATION
Work permit It is necessary for any nationals without exception.
Visa No Visa is necesarry to enter Mexico.
Residency permits / registration certificate This residency permits is allowed in long assignments.
Driving license Not acceptable for any foreign countries, must apply for a Mexican driver license.
STOCK OPTION PLAN Taxable until the stock option plan gain is obtained otherwise isn´t taxable.
ARTICLE 15 OF THE OECD MODEL
183 days Yes.
Notion of employer Only applicable if exist a labor relationship in Mexico.
Existence of a permanent establishment If the individual sign contracts besides the foreign resident can be trigger a permanente establishment.
Omar Garcia
Tax Partner
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Direct line: (52) 81- 8100-9848 Ext 118
Address: Ave. Humberto Junco Voigt 2307 Torre II Torre Martel, San Pedro Garza García, Nuevo León, Mexico, C.P. 66269
www.mazars.mx