How corporate tax works in Mexico
Mexican resident companies are generally taxed on worldwide income at a 30% federal corporate income tax rate. Nonresident companies are taxed on Mexican-source income or through a permanent establishment.
Most companies make monthly provisional tax payments and file an annual return by 31 March. Transfer pricing, interest deductibility, e-invoicing and documentation are part of the real compliance burden.
Dividends can add another layer of tax. Mexican companies generally distribute from CUFIN without extra corporate-level tax, but distributions outside CUFIN can trigger gross-up tax, and dividend payments to individuals or nonresidents usually carry 10% withholding.
Tax rates at a glance
- Corporate income tax
- 30%Federal rate
- Dividend withholding
- 10%
- VAT
- 16%
- Border VAT
- 8%
- Annual return deadline
- 31 March
Who benefits most
These profiles tend to benefit most when the rules match their real residence, payroll and business setup.
FoundersHolding companiesRegional operatorsInvestorsCross-border groups
Watch out for
- Mexico's 30% headline rate is only the starting point. VAT, payroll tax, IMSS, INFONAVIT, transfer pricing and withholding rules can materially change the effective cost.
- The monthly compliance calendar matters. Missing provisional payments or CFDI requirements can create penalties and cash-flow stress.
- 2026 compliance remains focused on digital invoicing, SAT scrutiny of related-party pricing and withholding on platform and cross-border payments.
Frequently asked questions
Does Mexico have corporate tax?
Yes. Mexico generally taxes resident companies at a 30% federal corporate income tax rate.
Are dividends taxed in Mexico at the company level?
Dividend distributions can trigger 10% withholding for individuals and nonresidents, and distributions from outside CUFIN can create additional corporate-level tax.
Is Mexico good for companies?
Mexico can work well for operating companies because it has a clear corporate tax system and a large market, but payroll, VAT, withholding, transfer pricing and documentation are all important from day one.