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Mexico Tax Guide

North America
Updated February 2026
Sources + last updated

This page includes citations to the sources used for this entry. Always verify with official sources before making decisions.

PwC Worldwide Tax SummariesSAT (Mexican Tax Authority)Tax Foundation
Special Regime
Personal Tax Score
48/100
High Tax
Business Tax Score
55/100
Mixed

Personal Income Tax

Tax Residency

Day Threshold
183 days
Note
183 days in Mexico, or if center of vital interests (primary income source or principal residence) is in Mexico

Income Tax Rates

Top Marginal Rate
35%
Structure
Progressive 1.92-35% across 11 brackets

Foreign Income Treatment

System
Worldwide
Details
Mexican tax residents are taxed on worldwide income. Non-residents taxed only on Mexican-source income at 25% flat on gross (or progressive rates on net if they elect).

Investment Income

Capital Gains
35%
Dividends
10%
Interest
0-35%%

Capital gains generally taxed as regular income at progressive rates up to 35%. Securities traded on Mexican stock exchange: 10% flat.

Wealth & Inheritance

Wealth Tax
No - No wealth tax
Inheritance Tax
No - No inheritance tax. Gifts above annual exemption taxed as income.

Special Regimes

RESICO (Simplified Tax Regime)
Simplified regime for individuals with annual revenue up to MXN 3.5M (~$195,000). Effective tax rates of 1-2.5% on gross revenue. Must issue invoices (CFDI) for all income. Available for self-employed individuals and small business owners.

Practical Notes

Popular with US expats due to proximity and low cost of living. RESICO regime offers extremely low rates for qualifying small taxpayers. Mexico's SAT is modernizing rapidly — mandatory electronic invoicing (CFDI) for everything. Don't assume foreign income goes unnoticed. US-Mexico tax treaty prevents double taxation.

Business & Corporate Tax

Corporate Income Tax

Headline Rate
30%
Effective Rate Note
30% corporate income tax. 10% additional tax on profit distributions.
Free Zone / Incentives
IMMEX (maquiladora) program for manufacturers; some incentives in special economic zones

Withholding Taxes

Dividends
10%
Interest
4.9-35%%
Royalties
25-35%%

VAT / GST

Rate
16%
Note
16% standard VAT nationwide (0% on food, medicine, and border region rate discontinued)

Compliance & Substance

Substance Requirements
Moderate - transfer pricing rules apply
Compliance Friction
High - mandatory electronic invoicing (CFDI), monthly VAT returns, complex reporting

Notable Regimes

  • RESICO simplified regime
  • IMMEX maquiladora program
  • Northern border zone incentives

Data Sources

PwC Worldwide Tax SummariesSAT (Mexican Tax Authority)Tax Foundation

Last updated: February 2026. Always verify with official sources before making decisions.

FAQ

What is the personal income tax rate in Mexico?

Mexico has a top personal income tax rate of 35%. The tax structure is: Progressive 1.92-35% across 11 brackets. See the detailed breakdown above and verify with official sources.

Do I need to pay tax on foreign income in Mexico?

Mexico uses a worldwide system for foreign income. Mexican tax residents are taxed on worldwide income. Non-residents taxed only on Mexican-source income at 25% flat on gross (or progressive rates on net if they elect).

What are the residency requirements for Mexico?

Tax residency in Mexico generally requires 183 days of physical presence. 183 days in Mexico, or if center of vital interests (primary income source or principal residence) is in Mexico. Always verify current rules with official sources.

Is there a wealth tax in Mexico?

No, Mexico does not have a wealth tax. No wealth tax

What is the corporate tax rate in Mexico?

The corporate tax rate in Mexico is 30%. 30% corporate income tax. 10% additional tax on profit distributions.