An individual citizen can derive income from another country that is subject to tax in that country. The person can credit the international income tax paid on the Mexican income tax liability. However, the allowance is limited to the lesser of I the amount of foreign tax paid in respect of foreign-source revenue that is taxable in Mexico and (ii) the amount of Mexican tax that applies to that income. In addition, overseas taxes on wages that are excluded from Mexican taxation are not permitted to be credited.
Tax treaties may decrease or abolish withholding tax on non-residents, and the terms of the treaty should be analyzed accordingly, depending on the country of residence of the person receiving income from Mexico.
Mexico has signed double taxation arrangements (DTAs) with the following countries:
|Belgium||Ireland, Republic of||Romania|
|Colombia||Korea, Republic of||South Africa|
|Finland||Netherlands||United Arab Emirates|
|France||New Zealand||United Kingdom|
Mexico has social security totalization arrangements in place with Canada and Spain. An agreement with the United States has been signed, but the consent process has not been completed.
For more information on how to obtain your tax refund in Mexico, follow the link.