Capital Gains Tax In Mexico

Capital Gains on Property Sales

Capital Gains Taxes in Mexico are determined from the profit received from selling a property or home in Mexico.   When you have sold a property you may have to pay the Mexican government Capital Gains Tax.  There are two options for determining Capital Gains Tax on a property sale:

Gross Sales Amount:  Where 25% of the “gross sales amount” is paid without deductions.

Net Value:  Where 35% of the “net value” is paid which includes several deductions. Net value refers to the difference between the original recorded property value – at the time you bought it – and the value at the sale. It includes several considerations as deductions, including Property Improvements (must have original Facturas), Real Estate Commissions, and Other allowable expenses.

It is important to note that property values are officially recorded in Pesos even though you will transact in US Dollars.  This makes Capital Gains Tax seem complicated by recognizing exchange rates and calculating taxes based on the gain in Pesos.

We work with a number of tax strategists to assist our clients in understanding their capital gains tax exposure in Mexico.   Their efforts are directed to optimize capital gains taxes in Mexico. 

The tax code in Mexico is different than that of your home country.  It’s  very important for you to consult your accountant at home regarding gains on your sale and implications for your tax position there.