Sept. 7, 2017 Update
For people who do not track multiple expat forums from around Mexico, there are some real-world updates that are worth noting regarding both ~ taxes on Mexican sourced income~ and on “tourist” visas.
Example: An acquaintance who has spent the few past winters in Yucatan as a snow bird, reports that he was unable to get a 180-day visa in Mexico City this time.
… “For the first time flew into Mexico City during my recent trip to the States, and immigration stopped me from coming through as they said I could not stay for 180 days on a tourist visa. In Cancun, they have approved every time. Mexico City held me for 2-3 hours causing me to miss my connection [to Merida] and
… ~ having to sleep overnight in the airport ~ . ”
Since their 2012 rule changes, INM has been gradually cracking down on foreigners’ abuses of “tourist” 180 day Visitante visas. INM’s general policy is that if we are frequently living in Mexico, even part-time, and that if we are working in Mexico (especially if we are renting out our Mexican property for income), then we really must
1. Get a Residency Visa … either a Residente Temporal or Residente Permanente Visa
See ~ Current Rules and Procedures for Immigration, Visiting, and Staying in Mexico
2. If we have Mexican sourced income, we must register with SAT/Hacienda by getting an RFC number
and
3. We must report that income from Mexico & pay taxes on it.
A recent first-hand report from a popular expat forum described some dramatic new shifts in enforcement of INM immigration & SAT tax regulations:
“A couple, which has been “coming and going on 180 day tourist permits (FMMs)”: technically not a “tourist permit”, but permission to be in Mexico, but not to work in Mexico, for a short period of up to 180 days] for several years” got off the plane recently, “they were then asked to step into the interrogation room and to hand over their phone and laptop, along with the password for their email. “
“They hold an on-line job from outside of Mexico. They were questioned about where they live, how long and what was their source of income. The agent then discovered an email on the computer that was an exchange regarding a VBRO email. It was a rental confirmation for a house that they manage for a Canadian friend. The money went into a Canadian account but as far as he was concerned they had income in Mexico. ”
“The lecture they got included three main points. They had been residing in Mexico on FMMs intended for Tourists. They would need a Resident Visa to stay in Mexico. They were not permitted to work in Mexico. ´Managing´ Mexican property is a lucrative activity. Lastly they would be responsible for paying tax on the rental income. [Although given a 30-day tourist permit, if they wished to return, the immigration officer said they would need “to visit a Mexican Consulate and apply for residency.”
This report describes the increase in several trends of the Mexican Government no longer tolerating foreigners breaking Mexican laws.
1. As Mexico’s INM, SAT / Hacinda / Aduana agencies gradually get all their local office computers connected to national databases, individual government agents (including clerks) can now pull up our personal records of past entrances & exits from Mexico and our past import/export & income generating activities, including violations of Mexican law.
2. The report (and many other similar recent internet reports by expats & ‘tourists’) pretty clearly shows that some INM airport offices now are more closely scrutinizing foreigners trying to get 180 Day “tourist” Visitante visas when flying-into Mexico.
3. INM no longer presumes that foreigners are somehow entitled to automatically stay up to 6 months on a “tourist” Visitante visa simply because they exited & then returned to Mexico.
4. We can no longer assume that INM & SAT/Hacienda will not track down income foreigners get from lucrative activities in Mexico. This includes operating rentals or even managing rentals, pet sitting, house sitting, etc.
5. People who intend to earn Mexican sourced income need to get visas that allow working in Mexico: Visitante con Permiso de Trabajo … Residente Temporal with permission to participate in lucrative activities (like working or earning rental income) … and Residente Permanente visas. These visas must be applied for outside Mexico at your local Mexican Consulate … and yes, some Consulates (like Laredo, San Antonio, Chicago, Portland & Phoenix) are far more friendly~lenient in granting these visas than the Mexican Consulates in California, Houston, Boston, et al.
See ~ Current Rules and Procedures for Immigration, Visiting, and Staying in Mexico
Note that foreigners who own real estate & rent it out … owe 25% taxes (“without deduction”) on the rental income. Details at:
http://www.sat.gob.mx/english/Paginas/English/how_do_foreigners_pay_taxes.aspx
6. Foreigners who get visas that allow them to work must also register their work with SAT / Hacienda, reporting income using their RFCs. Note that the RFC’s generated by Mexican banks are generally not valid for use for reporting & paying taxes on Mexican sourced income.
Happy Trails
… and …
Keep doing your best to color inside the lines,
steve
* * * *
Feel free to copy while giving proper attribution: YucaLandia/Surviving Yucatan.
© Steven M. Fry
Read-on MacDuff . . .
Surviving Yucatan 
Thank you for this update . I for one am really happy that the Mexico is beginning to wake up . There are so many people out there making an income and not declaring
Our hope is that increased more-effective enforcement of the laws will reduce the
“ YAY … We’re in Disney-Land … No rules for us! ”
ways that too many gringos act.
Mexico has a solid shot at having a healthy economy & good society, but that means people ~including visitors/guests~ stop cheating & instead pull their weight.
Incremental changes can be the way.
steve
Totally agree. I am more than sick of the entitled “Americans” who come down here and think they are above the law, culture, and customs of Mexico…which is exactly why I left the US to move and live here.
Amen. The US dropped the ball on this long ago which has contributed to the myriad of problems there.
In your blog post you mentioned San Antonio being known as being easier to deal with regarding visa applications. What is your basis for this statement? Not wanting to be argumentative, just wanting some more background information before I plan a trip to San Antonio to apply for a permanent visa. Tried contacting the consulate in Dallas but got no response. Any additional information you can provide is greatly appreciated. Thanks!
Americans who have used the Mexican Consulate in San Antonio have reported that the office was helpful, followed SRE’s published immigration law, and that they accept any proven monthly deposit income for qualifying for either RP or RT visas.
Boston & California Consulates frequently add special local extra (difficult to meet) requirements that do not exist in Mex. Gob. law as published in the D.O.F.
PLEASE SEND ALL REPORTS THANK YOU
Sad that you even have to post this. I am disgusted by how many Americans just drive into Mexico and don’t even bother to get a visa of any kind. These changes have been around for a long time. Mexico is a very inexpensive place to visit and work, yet most Americans I meet seem to think “they owe us”.
What the F**k are you talking about? F**k the government and their “tax” extortion! You fking slave
Normally, we delete things like this …. but it’s important to publicly identify the Don Juan … aka Mohamad Hasm of dskjdf@_mail as the fine individual he is.
Mohamed Hasm. LMAO. That explains everything we need to know. I hope we (Mexico) never, NEVER, ever, EVER lets Muslims come here. Just look what they have done to France, Germany, Italy, UK, Europe, USA, etc. Once they take over, it will all be over. STAY STRONG and STAY PROUD MEXICO!!!
Things are changing all of the time. This year I spent three months trying to get an appt. in Chicago to start the visa process but was unable to. I went in person and she told me three times that just because I completed all of the requirements did not mean I would get a visa. It would all depends on a personal interview with her. She had no time to talk to me, all appts. had to be made online but she wouldn’t respond to my emails. She didn’t have time to talk to me on the phone. Then she finally made me one but then cancelled it without my knowledge.
What an ugly response from the Chicago Consulate. They’re officially on the “Band Consulate” list now.
steve
Nice to see Mexicans finally understanding what Americans have been dealing with for decades. Cudos. Those economic migrants can certainly put a strain on the economy.
P.S. You might want to delete Don Juan’s email since, when leaving a reply, it states that your email will never be made public. This could leave what you did actionable in a court of law.
Interesting. The no-publishing email addresses is a WordPress policy that we’ve never seen as site owners.
Thanks! … I have corrected the reply to no longer show Mohamad’s email address.
It turns out that Mohamad Hasn’s email address is bogus anyway.
I have a temporal visa and want to do Airbnb for just my spare room. Do I need to go back to where I got my original visa and ask for permission to do so? I don’t mind paying taxes as I paid heavy hotel taxes where I Airbnb’ed in the States. I’m sure when I start there will be resources to tell me where and what to pay. I just want to make sure I have permission. I am a guest here after all.
You need to convert your ordinary Residente Temporal visa into one with permission to participate in lucrative activities. (I mis named it above as con permiso de tragajo). You would go to your local INM office to do this.
Thank you. Nice to know I don’t have to return to Houston to do this.
Check with your INM office.
Hola,
For the amnesty process, do you know if you still have to initiate the process outside of Mexico? Or, what office do you go to, to begin that process of obtaining a temporary residence?
Thank you for this helpful information!
I had to start in the US at the mexican consulate, 2 years ago. It wasn’t difficult but all my research indicated I would need a temporary residence for 4 years before I could get the permanent so that was my intent. I had just recently purchased a US plated vehicle from an expat who was going from TR to permanent and would not be allowed to drive a foreign plated vehicle. The vehicle was in a mexico. Once I presented my documents I was automatically granted permanent, probably because I owned a home, had a professional career and would not be a burden financially to Mexico. I was stressed because that meant I would have to deal with getting rid of the vehicle I just purchased. After explaining my case, the officer granted me temporary but thoughts my reason was not smart. He was right. In the long run, it will cost me a lot more money. Had I realized that clause that owning a home almost always gets you permanent, I would have processed differently. I now own. Mexican plated vehicle and a US plated that needs to get out if the country or be did to an expat.
Lucky you – we are still on our temporary resident permits because they would not grant us permanent status right away, even though we owned two homes outright, with a guaranteed social security income, a second monthly pension, and other retirement assets besides.
We found a local accountant that does our tax. It can be complicated but he does it all. You have to register your ‘business’ and usually attach it to a credit card if you want to claim deductions. All purchases have to be made on that card or by cash if under $2000mxn. Only ‘facturas’ are deductible. You need an RFC with three letters or numbers at the end, not just the usual RFC.
What are the Mexican taxes, percentage-wise, on rental property? Just a ballpark figure.
Depends if the apartment is furnished or unfurnished. If it is furnished, there is ALSO the 16.5% IVA for being furnished, while unfurnished apartment income is taxed at the normal income tax rates. ( So, both IVA and income tax may be owed.) Mexican income tax ranges from roughly 3% at the lowest levels to 35% at the highest levels (tiered). … lower than the USA until you hit about $75,000 USD in Mexican income.
Just now found this April, 2017 SAT website that says: 25%.
http://www.sat.gob.mx/english/Paginas/English/how_do_foreigners_pay_taxes.aspx
I am a TR of Mexico and I asked for no work permit because my Spanish is not good enough and I have retirement income. I have 2 years left before I can apply for permanent. Recently I purchased another home and working on selling my first house. In the meantime, I do have renters in the first house. I know INM will not just give me permanent because I asked after my first year ad they said I had To go 3 more years of temporary before I could get permanent. I am not trying to break any laws but I am hoping the house sells soon and that will be behind me.
That “first hand report from a popular expat forum” sounds a bit fishy. Where was that originally posted?
I have a question… I’ve decided I want to stay in Mexico. My husband and I have almost spent one year here, aside from the two trips to renew our tourist visa and visit family in Canada.
We have a website that sells courses online. It’s not incorporated, it’s taxed as sole-proprietor income. Everything is registered in Canada at this point, including the bank account which our earnings are transferred to.
Canada is saying we need to pay tax to Mexico, because of the tax treaty and we have spent more than 183 days in Mexico. I have no problem paying tax to Mexico but I’m not allowed to earn money in Mexico.
I spoke with an immigration advisor in Mexico and she said there’s no reason for me to pay tax to Mexico because everything is based in Canada.
I’m not really earning money in Mexico… I am physically in Mexico and working on my computer (working for myself) but I am not selling anything to anyone in Mexico, employing Mexicans or working for a Mexican company. It’s kind of like freelancing.
I’m sure there are others in this position. Any advice about who to talk to or which visa I should look into applying for? I feel like I’m in the gray area of a non-tangible business located wherever the internet may take me 😉 Thanks!
Hi Amy,
Excellent questions. Since your tax responsibilities are determined by the Mexico-Canada tax treaty, the only advice you accept is from experts familiar with both the treaty and how it works (precedents).
Do you trust the expertise of the Canadian who quoted the “183 day” half year limit? Is it possible that you need to have a business registered in Canada that pays the taxes?
I would not trust random Mexican tax people, unless they have a lot of expertise in the Mexico-Canada tax treaty.
If the Canada tax authority will not accept your payments, then you need to get out of Mexico to a Consulate, and apply for a visa that allows you to work in Mexico.
Happy Trails,
steve
The interesting thing is about the people I spoke to about the taxes was that they all initially said I should pay taxes to Mexico (because of the 183 days or more per year here), but then after explaining the banking, the domain being registered in Canada, mailing address etc. they said it was okay to continue paying taxes to Canada. I spoke to the Canada Revenue Agency, my accountant that I’ve been using for years and also an immigration accountant who does this for a living. The person I spoke with in Mexico is an immigration consultant that seems pretty reputable.
Last year, I was able to play the ‘temporary tourist without a plan’ card, but this year, I’ve spent my whole year in Mexico and feel that I need to have some solid answers to move forward confidently.
Speaking with the consolute, it didn’t seem very promising that I’d be able to get a working visa. I don’t have university credentials which seems to be something they require for a work visa that is not sponsored by a specific company. It would be easy for me to get a sponsorship for a work visa, but that limits me only to earn income from that particular company.
Yes, it’s complicated living between the clear rules. However, I’m sure I can ask more specific questions about making it a Mexican company or doing whatever I need to do. It sounds like a few appointments with accountants, business lawyers and immigration specialists are in order.
I suggest you look closely at the option of forming a Mx. Corp.
The benefits are many, the downside is minimal.
Key: find a active Mexican accountant that also regularly deals with employee and real estate transfers. Interview several. They can direct an Atty. to correctly setup a corp that works for you now, and later also helps with immigration and home ownership (the real kind, not rented land)
It has worked very well for me.
I never needed to show income for my FM renewals, just a current tax return to show the business is active… very simple. I became inmigrado without ever messing with additional paperwork.
I am a true home owner and have been able to buy and sell various properties thru the years.
Best wishes
Also, the laws are clear. I have always been confident that I am 100% legal (and would pass audit) on both sides of the border. (I pay foreign earned US income tax if/when it is due)
Thanks for sharing your opinion about the corporation. I have been thinking the same thing as well. Either setting-up a corporation in Mexico, Canada or even off-shore (tax haven option).
I believe the Mexican corp will help us for the long-term benefits like you have mentioned. Also, having a Mexican business will allow me to sell my English courses here in Mexico that help intermediate to advanced level English learners reach fluency 😉
https://realenglishconversations.com.
Hi, Steve–
This article about the “Interrogation room” and intervention in a private email account is popping up all over the Internet, with most sites pointing back here to this article.
Please tell us where the original report was published!
Thanks–
Wonder if this would have happened without the crackdowns on immigrants in US?
That’s a tempting idea, but this policy has been around since 2013.
Then consider that INM agents efforts to apply it have been growing & expanding every year since the 2010 Law created it and the 2012 Reglamentos laid out the residency vs visitors visas purposes & requirements. … So, as an effort that started & growing for 5 years before Trump, should we really try to blame Trump for this one?
steve
WHERE ARE THE AGENTS .lots of gringos without papers .inBAJA. make a new check point below ENSENADA BY MILITARY CHECK POINT
Interesting article. I’m probably a few months late asking this, but I will ask anyway: how do you go about getting a work visa if you aim to work as an English teacher for several language schools? I’ve lived in Mexico and I like the idea of going back there, but I’d effectively be a freelancer working for more than one language school plus finding private clients. I don’t think a language school would sort out a visa for me if I was only working part-time for them.
Many thanks,
Jasper
You apply at a Mexican Consulate for a “Visitante visa con permiso de actividades remuneradas” or a “Residente Temporal visa con permiso de actividades remuneradas” … or for a Residente Permanente.
Details at our main article on immigration at:
Thanks Steve/Yucalandia for this piece of info – much appreciated. Jasper
Hello Steven,
We live in San Carlos, Sonora and trying to find the legal information regarding driving a US plated car in the Hassle Free Xone, while holding a permanent residency visa. Would appreciate a little direction. Thanks, Nidza
Hi, I’m working on an article in the same topic. From what I am reading here the conclusion seems to be that if a person is living in Mexico on a tourist card AND earning income in Mexico chances are that person will get stopped. On the flip side there are many “Bill and Mary from Topeka” couples that go back and forth every six months and they just sit on the beach eating shrimp cocktails. They probably won’t get stopped. Do you think that’s a fair assessment?
I’d stick with the law.
First, there is no such thing as “a tourist card” … Has not been since 2012.
Next: People earning income working here on Visitante visas, simply apply for a “Visistante Visa con permiso para actividades renumeradas ” …
Re “Bill & Mary from Topeka”
Next reality… Since 2014 … INM has been cracking down on serial Visitante visa users, who pop back to the USA, and then try to come back on another fresh Visitante visa. Note that many INM agents are giving those serial Visitante visa abusers as LITTLE as just 7 days the next time they try to enter Mexico on a Visitante visa.
So, every year since 2014, it has been getting more & more risky to try to do keep entering Mexico on serial Visitante visas.
This has been reality at the Guatemala border, the Texas & Arizona border, and the Belize border.
Steve
Hi, thanks for the reply. You make this statement:
“Next reality… Since 2014 … INM has been cracking down on serial Visitante visa users, who pop back to the USA, and then try to come back on another fresh Visitante visa. Note that many INM agents are giving those serial Visitante visa abusers as LITTLE as just 7 days the next time they try to enter Mexico on a Visitante visa.”
That is where I am lost. Was there a press release from INM regarding this crackdown? You are the third person to mention this but I cannot find an official statement from INM.
Hi,
Each individual INM agent has had this discretion, since at least the 1990’s. In Nov 2012, INM released their “new” Reglamentos – that described the new categories of Residente Temporal & Residente Permanente.
With those changes, INM resolved that foreigners who come to Mexico frequently should STOP using the 6 month visa, and instead file for residency. In mid – late 2013, SOME expats across Mexico started reporting on webforums that they had been given only very short period Visitante Visas … and that they had been told to go to a Consulate and apply for a Residente visa.
That policy became more frequently enforced in 2014 … until by 2018, it became a bit risky for foreigners to make their “border-run” every 6 months to get a new Visatante Visa. At some border crossings, the INM agents went so far as to deny them re-entry for 3 days … unless they paid an extra $fee for “expedited processing”, to get fresh Visitante Visa that day.
Happy Trails,
Steve
I must disagree. Perhaps this was true in 2012 but not now. I interviewed Fransisco Perez of the Veracruz INM office and he relayed to me that there was no concerted effort by the Mexican government to find violators of the FMM from Canada or the United States. The INM main concern was people from Latin America.
If you have a press release from the Mexican government regarding the crack down, please share. I cannot find any evidence of this.
Notice that your “source” did not even use the correct terminology.
The FMM is just a form … used by ALL foreigners, including ALL Resident Permanentes and Residente Temporal visa holders.
To do a supposed “no concerted effort by the Mexican government to find violators of the FMM on FMM violators:” … There is no such thing as an FMM violator in either the INM law nor the Reglamentos.
The correct legal term would be a “Visitante Visa violator” … When a supposed report badly misuses the terminology, lumping in Residente Temporal & Residente Permanente as supposed “FMM” violators – it discredits them as a source.
Instead of quoting bad confused sources, please re-read what I wrote above.
Notice that I intentionally did NOT cite or reference any supposed official published policy out of Distrito Federal … that idea of some kind of published policy is your idea (Don) … If you read my report of 100’s of foreigners being stopped for abusing Visitante Visas since 2013, including giving them just 7 days in Mexico is a result of the actions of individual INM agents at the Texas-Mx border, the Az-Mx border, the Guatemala-Mx border and the Belize-Mx border.
Then notice that I wrote:
“That policy became more frequently enforced in 2014 … until by 2018, it became a bit risky for foreigners to make their “border-run” every 6 months to get a new Visatante Visa. At some border crossings, the INM agents went so far as to deny them re-entry for 3 days … unless they paid an extra $fee for “expedited processing”, to get fresh Visitante Visa that day.”
So… I realize that you imagine that there is some published rule or coordinated effort, but as I wrote
“Each individual INM agent has had this discretion, since at least the 1990’s.”
Reality is the key … The actual policies being applied by individual INM agents is what’s significant.
Supposed ‘edicts’ or ‘press releases’ are not important, when so many foreigners are having problems getting another Visitante Visa, because so many INM agent are deciding the foreigners are abusing them.
Does that make sense?
Steve