Global mobility reminder: tax requirements for changes of residence in Mexico
InsightsForvis Mazars in Mexico: Thought leadershipTax alert
Tax requirements for changes of residence
Remember that, as of January 1st, 2021, individuals who fail to submit their notice of suspension of activities due to a change of tax residence will not lose their status as residents in Mexico.
The latest Official Gazette of the Federation (Diario Oficial de la Federacion), on the decree that reforms the laws of Income Tax, Value Added Tax, and Fiscal Miscellaneous Matters of the Fiscal Code of the Federation, established that natural persons who lose their tax residency in Mexico, they must submit a notice to the tax authorities. Failing to submit said notice, does not mean they lose their status as residents in Mexico.
The repercussions of this reform contemplate include, among others:
- An obligation to file an annual return in Mexico and report worldwide income.
- An obligation to present provisional payments and paid taxes up to 35%.
- The payment of fines and accessory penalties for failing to submit provisional payments and notices about updates to the Mexican tax ID (RFC).
- Rendering favourable balances irrecuperable.
Want to know more?
Jorge Chávez Mercado Tax Senior Manager Mexico City
