2016 Mexican Tax Law Changes

Oct. 22, 2015
On October 18, the Mexican Congress amended the tax law for 2016.

Under the new rules, most gains from selling our primary residence will be exempt from capital gains after living in the home for just 3 years, instead of the current law’s every 5 years. … Read our main article on Capital Gains for more details at:   ~ Capital Gains Taxes on Mexican Properties ~

Soda pop manufacturers got a reward of  50% reductions in taxes on high-calorie drinks  (as Mexicans drink the most soda per person in the world).

The business deduction tax limit on cars has been raised from 130,000 pesos to $175,000 for 2016.   … Thanks to  Lic. Spencer Mullen for this good information!


For more details on Mexican Tax policies, see our main Mexican tax article at:

~ Capital Gains Taxes on Mexican Properties ~

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Feel free to copy while giving proper attribution: YucaLandia/Surviving Yucatan.
© Steven M. Fry
Read-on MacDuff . . .

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11 Responses to 2016 Mexican Tax Law Changes

  1. playaright says:

    Thanks for the information Steve, though I don’t understand the ‘car tax limit’? Does it mean that if you buy a new/used car less than 175,000 pesos you don’t have to pay tax on it?

  2. Kim Tempel says:

    Unless something drastically has changed this year, there is no total exemption from ISR taxes, regardless of how long you have owned your home. There is a partial exemption that serves to exempt a portion of your gain – the result can be a total exemption in some cases, if your gain is low enough, but there is no blanket exemption from ISR taxes any longer.

    • yucalandia says:

      Hi Kim,
      As noted in our main article ~ click link above ~ : The 2014 ISR law included a cap on the exemption of 700,000 UDI’s. As explained in the main article, a UDI is a fluctuating financial instrument whose rate can change daily.

      The exemption cap translated to approximately $270,000 USD of gains in 2014.

      For most of us, a $270,000 exemption is more than enough to cover our home’s net gain in value.

      From the main article:
      **Curious readers who want to determine the current official UDI-Peso value can go to: http://www.banxico.org.mx/SieInternet/consultarDirectorioInternetAction.do?accion=consultarCuadro&idCuadro=CP150&sector=8&locale=es

      • Kim Tempel says:

        Hi Steve – Thanks for clarifying that – I’ve already had several clients send your article to me, as they are interpreting it to mean that they are exempt from ISR taxes after 3 years. That is not the case. In our area of Quintana Roo, the practice for many, many years was to grossly understate what a buyer paid for his/her property – so most of my clients (I sell real estate) are facing huge capital gains because buyers now (rightly so) will not agree to understate the transaction. For us, there is an important distinction between a blanket exemption and a partial exemption. In the past 2 years since the law changed, I’ve only had 1 client who was able to pay zero ISR. Don’t know if it’s possible to clarify in the body of your blog post, but it would save me a lot of explaining if it didn’t appear to state that there is a blanket exemption from ISR after 3 years!


      • yucalandia says:

        Hi Kim,
        Yeah, Mexican realtors really did not do their expat clients any favors by supporting the seller’s games of reporting/recording fake way-low sales prices in Mexican government records.

        … because that’s how we’ve always done it. …


      • Kim Tempel says:

        Agreed! Often there weren’t “realtors” involved and there is one “attorney” in our town in particular that people trusted who never once mentioned that it was tax fraud or the consequences of paying a little bit more on the front end vs. being taxed at 35% on the back end. Trust me, it’s no fun being the person breaking the news re: ISR tax owed. We have the calculation done before we even formally list the property so there are no surprises on closing day… Sigh.


      • yucalandia says:

        Well done ! and … yep, it’s hard straightening out other people’s messes.

        but it’s worth it,

  3. Hi, article was drafted by me, it is limit for business to deduct cost of car from income tax

  4. PV lady says:

    This is not a tax law but Article 1032 affects us all and I understand that it was just found as unconstitutional. It is the condo law which allows a HOA to sue an owner for delinquent dues. I was wondering when this happened and if you have any further knowledge of this?

  5. PV lady says:

    Or…. can anyone prove or disprove that this happened?

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