Monday September 14 2020

Posted by BajaInsider.com on July 12, 2020
  • An official document
    An official document
  • Parts of a Factura
    Parts of a Factura

A Factura is a legal receipt given for goods and services in Mexico that can be used for business expenses or for deductions in Mexico businesses. The receipts you receive from most vendors are not facturas but “Nota De Remission” (a simple receipt). You must generally ask for and or go to a special office, window (caja) or cashier to receive the official receipt known as a Factura. You will have to provide your company’s address, legal corporation name and tax identification number which is called an R.F.C. or Registro Federal de Contribuyente.

A Factura must include a copy of the sellers “cedula” or tax seal with their R.F.C number, their company address, and phone number. When filled out correctly it must also have the items purchased, prices in pesos and the sales tax (I.V.A.) separately included with the grand total amount also written out in letters on the factura.

As of 2015 all facturas must be processed electronically when issued. Copies are usually sent to both the sender and receiver, but more importantly, to Haciena – Mexico's version of the IRS. Instantly the government knows how much tax the seller has collected and owes the government and what the buyer has the option to deduct from his proceeds. 

If you are earning money from renting a property in Mexico you must have and RFC, issue facturas and pay taxes on the income. Otherwise the government has the option to sieze your property.

To obtain an RFC number you must apply wherever you will be doing business at the local Secretaria de Hacienda y Crédito Publico (SCHP). “Hacienda” as it is more commonly referred to here in Mexico is the equivalent to the U.S. Internal Revenue Service. Whether you are doing business as a corporation or a sole proprietorship (use of personal RFC) you must have an R.F.C. number as well as you must obtain a personal one for filing your personal income tax here in Mexico if you must do so.

The Mexican government and banks are very picky about their forms being complete and with NO corrections. Facturas are printed in series and all Facturas must be accounted for even if they have been voided, canceled or lost. You must be sure to save or recover all copies of a factura before it will be accepted by Hacienda as canceled.

What is so important about the factura is that these are the only receipts accepted for your business expenses. In other words, if you don’t have a factura for it then it does not go on the books. For example, when you buy gas and want to deduct it as a business expense you had better obtain a Factura and not just a sales receipt or nota de venta as it is called.

If you are building a home in Mexico it is important to save EVERY factura paid by yourself. Register reciepts won't count. This becomes important when you sell the home as to how much tax you will owe. 

In your business you are required to create a factura for every sale you have and or you may make a general one for cash receipts for the day for example. If you do not create a factura then the money will not be properly accounted for and Hacienda will be interested in why you are not making any income.

While most tourist, retirees and even a lot of the Mexicans are not interested in obtaining a factura as they have no need or desire to deduct these expenses, you must still write or print out a factura if it is going to be accounted for. One trick you will see a lot in Mexico is the “we won’t charge you sales tax if you don’t want a factura”. This “discount” is not exactly something Hacienda will look kindly upon if it finds out about it. This is the way people do business under the table in cash but of course, the law states that the 11% is to be charged on all goods and services.

You must be careful when getting a quote on goods or services because many times the IVA has not been included in your total and when you ask for a factura the business will then say you must pay an additional 11% to obtain a factura. This, of course, was never to be an option according to Hacienda. The way to avoid any hassles is to be sure to tell the business that you do want a factura for your business expense and the bid will include all taxes and no surprises.

Now for larger corporations with a lot of imported goods in inventory, this could be a substantial amount that you have pre-paid while waiting for it to sell. There are ways to account for this and receive credits on the inventory you are sitting on.

This is just a simple primer on the subject of “facturación” and it is important that you speak with your own accountant on how your Mexican tax liabilities are to be dealt with.

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