Declaring Rental Income from Property in Mexico
by Lic. J. Beaulne LL.B
A good criminal lawyer and friend of mine once gave me the real title for a prison: “La Maison des Smarts” (French): The house of the SMARTS and Kenny Rogers says in one of his best songs: You can’t run away from the law…So true are both expressions.
On the 23rd. of August 06, in the most read new paper in Baja California Sur, The Sudcaliforniano, appeared an article in which a member of the State congress is said to have provide to the Secretary of finance the names and addresses of persons renting their dwelling to tourists without having the proper government authorization and not declaring their income. Today, 24th of August appears in first page the picture of one of such houses used as a “hotel” and more…. WHY??????
Because people who have invested to legally operate a rental place for tourist are feed up of loosing money and complained to the authorities and the 3 levels of government are loosing much needed tax income.
A) One who generates income MUST declare to SAT and if one decides not to do so he faces FINES AND JAIL as per the law .
B) In the case that one is a foreigner IMMIGRATION will have to apply sanctions up to expulsion.
C) The Secretary of Economy (Secretaria de Economia) will also apply fines.
D) If an FTD contract (Contrato de Fideicomiso Translativo de Dominio) so wrongly called a “bank trust” is the document providing Rights on the property one could be loosing said Rights because of the fraud caused and non respect of the obligations one has in said contract.
E) The property could be seized and put on the block for sale.
And more and more….
Who should I speak with to be certain that this will not happen?
A legal firm that operates in a real professional manner.
When: Now before the Mexican IRS (SAT) and other government authorities notifies you.