Tax Obligations for Vacation Rentals in Mexico
Owning real estate in Mexico, and particularly in the Riviera Maya, can have several advantages for you & your family. Having a vacation home in one of Mexico’s most renowned destinations & earning additional income is considered having the best of both worlds. All through the years, several foreign investors have created a nice rental income for themselves. But like anywhere else in the globe, you have to sacrifice a part of your profits by way of taxes. Learning the local tax laws should be researched & studied before and/or during the buying process.
Owning real estate in Mexico, and particularly in the Riviera Maya, can have several advantages for you & your family. Having a vacation home in one of Mexico’s most renowned destinations & earning additional income is considered having the best of both worlds. All through the years, several foreign investors have created a nice rental income for themselves. But like anywhere else in the globe, you have to sacrifice a part of your profits by way of taxes. Learning the local tax laws should be researched & studied before and/or during the buying process.
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Tax Obligations for
Vacation Rentals in Mexico
Owning real estate in Mexico,
and particularly in the Riviera
Maya, can have several
advantages for you & your
family. Having a vacation home
in one of Mexico’s most
renowned destinations &
earning additional income is
considered having the best of
both worlds. All through the
years, several foreign investors
have created a nice rental
income for themselves. But like
anywhere else in the globe, you
have to sacrifice a part of your
profits by way of taxes. Learning
the local tax laws should be
researched & studied before
and/or during the buying
process.
Listed below are some simple tax tips that might assist when
investing in Mexico’s growing real estate market:
• If you work and/or gain income from an investment in Mexico
(even if you aren’t a citizen), you’ll most probably have to pay
income taxes. A good place to begin is by contacting the Servicio de
Administración Tributaria (SAT or Hacienda).
• All income earned in Mexico carries a certain taxation.
Regardless of how it’s distributed or gifted, paid in pesos or USD,
or any other monetary valued payout. It has to be reported as
income.
• When you own property in Mexico & are a partial or full-time
resident, you have to register with Mexico’s Registro Federal de
Contribuyente (RFC). This is identical to your Tax ID number.
• All rental earning is subject to Impuesto Sobre la Renta (ISR).
Your residential status is independent from it. You must pay
taxes on your rental earning. The ISR tax rate is based on 25
percent of your gross income earned.
• If the rental property is furnished, on top of the ISR tax,
there’s an Impuesto al Valor Agregado (IVA), or valued added
tax (VAT). The IVA is collected from the renter & paid to the
Mexican govt by the landlord. This is an extra 16 percent tax
charged directly to the tenants.
For more information on Mexico luxury real estate feel free to
contact Run Away Realty. Working with a collaborative team
approach, we help others in discovering how special our community
is. If you’re thinking of buying or selling in Mexico, we are always
here to assist you. For a hassle free real estate experience in Mexico
you can always rely on us. Sign up with us now to receive news and
property listing alerts.
Contact Us
Address:
Run Away Realty
Avenida Niños Héroes, Puerto Morelos
Mexico , USA
Zip: 77580
Phone: +52 1 998 100 3125
Email: info@runawayrealty.com
Web: http://runawayrealty.com/