Supreme Court removes acreditation of VAT in compensations

April 13th, 2023

On March 15, 2023, the Supreme Court of Justice of Mexico established a core precedent where the civil compensation is not a form to extinguish obligations between creditor and debtor, nor a mean of payment of Value Added Tax (Hereinafter “VAT”) for its accreditation and refunding.

On the other hand, all VAT considerations are considered, without taking into account that the tax paid is a requirement for its crediting.

Additionally, the tax authority warns that there is no way for the VAT payment obligations cease to exist; on the contrary, the VAT that has been compensated will be considered as an additional cost.

The foregoing will generate a greater control with respect to all VAT taxpayers and affecting centralized treasury processes. The tax authority will also be able to see the history of the use of compensations and refunds, VAT, income tax deductions, among other.

52-81-24748538
www.j-bravo.com
Blvd. Antonio L. Rodríguez 3000, Colonia Santa María, 5to piso, Interior 501 Torre Albia, C.P. 64650 Mty, N.L., México T.

Download Newsletter

Boletines relacionados

Revisting maquiladora operating models: Strategic alternatives.

Revisting maquiladora operating models: Strategic alternatives. Background. The maquiladora regime has been a central component of Mexico’s manufacturing growth since the 1990s, driving foreign direct investment, particularly in sectors such as automotive, electronics, and medical devices. This regime allows multinational corporations to establish manufacturing operations in Mexico under the IMMEX program, which grants fiscal and tariff exemptions when importing machinery, equipment, and raw materials to produce goods for export.

Second resolution of amendments to the miscellaneous fiscal resolution for 2024

Renewal of the Qualified Maquiladora Approach Agreement

September 19, 2024 Renewal of the Qualified The IRS and Mexico’s Servicio de Administración Tributaria (SAT) have agreed to again renew the Qualified Maquiladora Approach Agreement (QMA), a coordination arrangement previously renewed between the U.S. and Mexican competent authorities in 2020 (2020 Renewal QMA). The 2024 renewal applies for the Mexican taxable years ending December 31, 2020, through December 31, 2024. The QMA allows a U.S. taxpayer to avoid double taxation on the contract manufacturing and assembly functions performed by its maquiladora if the Mexican taxpayer enters into a unilateral advance pricing agreement (APA) with the Large Taxpayer Division (Administración General de Grandes Contribuyentes) of the SAT under terms negotiated in advance between the competent authorities.

Revisting maquiladora operating models: Strategic alternatives.

Second resolution of amendments to the miscellaneous fiscal resolution for 2024

Renewal of the Qualified Maquiladora Approach Agreement

Reform to the Federal Judicial Banch

September 19, 2024 Reform to the Federal Judicial Branch The constitutional reform initiative that modifies the Federal Judicial Branch has already been approved by both chambers of Congress and is now being reviewed by the missing state legislatures. This reform involves significant changes that will take effect in September 2025, which presents challenges for judicial procedures initiated before that date.

Resolutions for companies providing maquila services from 2020 through 2024

On July 22, 2024, the Tax Administration Service (hereinafter “SAT”) updated its website regarding the “Resolutions for Companies Providing Maquila Services” (hereinafter the “Website”), pursuant to the renewal of the Qualified Maquiladora Approach agreement (“QMA”) by the SAT and the Internal Revenue Service of the United States of America (hereinafter “IRS”).

Presidential Proclamations Concerning Imports of Aluminium and Steel

July 10, 2024, Adjustments to Imports of Aluminum and Steel into the United States. Presidential Proclamations Concerning Imports of Aluminum and Steel. The White House today posted on its website two presidential proclamations concerning imports of aluminium and steel into the United States.