Mexico City Tax Benefits 2022: Write-offs

March 30 2022

On March 22, 2022, both the “General Resolution through which the payroll tax is canceled in favor of the indicated taxpayers” and the “General Resolution through which property tax exemptions are granted in favor of the indicated taxpayers” were published in the Official Gazette of Mexico City (“CDMX“).

These resolutions became effective the day after they were published in the Official Gazette of Mexico City.

  1. PAYROLL TAX (“ISN”).

100% of the payment of the ISN is canceled for individuals or legal entities that constitute or start operations of a micro or small business and make disbursements in cash or in goods for remuneration of subordinated personal work in Mexico City.

Term of the benefit: The first three months after the incorporation or startup activities of the micro or small business.

 Other benefited companies: Micro and small companies, individuals or legal entities that have suspended activities since March 1, 2020 and that restart their activities from the day of the entry into force of this instrument.

 Validity: The benefits will be in force until December 30, 2022 and will be extendable in favor of taxpayers that incorporate or reinitiate activities during October, November or December 2022, regardless of whether the benefits are carried forward to January, February or March of fiscal year 2023.

 PROPERTY TAX (“IP”).

The payment of the IP[1], caused as of the second two-month period of fiscal year 2022, is partially canceled for taxpayers 58 years of age or older, without fixed income and of scarce resources, who are owners of the land or the land and the constructions attached to it, regardless of the rights over the constructions held by a third party.

Requirements: Property for residential use whose cadastral value does not exceed $2,323,374.00 pesos. Only a fee of $55.00 bimonthly will be paid.

When the property exceeds the cadastral value, a 30% remission of the tax payment is granted[2].

Validity: Until December 30, 2022.

 Additional beneficiaries: Surviving spouses of the owner that are 58 years of age or older, without fixed income, of scarce resources, when the deceased spouse appears in the property tax registry as owner of the property for which the remission is requested.

We recommend a detailed analysis of the above publications to corroborate the applicable requirements and conditions.

 

[1] Indicated in the ballot issued by the Secretary of Administration and Finance of CDMX.

[2] Caused as of the second two-month period of fiscal year 2022.

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