Article 154 of the Mexican Income Tax Law
In the case of income from salaries and in general for the rendering of a subordinated personal service, the source of wealth will be considered to be in Mexican territory when the service is rendered in the country.
The tax will be determined by applying the following rates to the income obtained:
- The first $125, 900.00 obtained in the calendar year in question will be exempt.
- The rate of 15% will be applied to the income received in the calendar year in question that exceeds the amount indicated in the preceding fraction and is not greater than $1,000,000.00.
- The rate of 30% will be applied to the income received in the calendar year in question that exceeds $1,000,000.00.
The person making the payments must also withhold the tax if he/she is a resident in the country or a resident abroad with a permanent establishment in Mexico to which the service is related. In all other cases, the taxpayer will pay the corresponding tax by means of a declaration that will be filed before the authorized offices within fifteen days after obtaining the income.
In the case of Section VII of Article 94 of this Law, it will be considered that the income is obtained in the calendar year in which the option to purchase the shares or securities representing the ownership of assets was exercised.
When the income in question is received for periods of twelve months under the terms of the seventh paragraph of this article and such periods do not coincide with the calendar year, the rates set forth in the preceding sections will be applied, based on the twelve-month period instead of the calendar year.
For the purposes of the provisions of this article and article 156 of this Law, taxpayers may guarantee the payment of the income tax that may be caused by the performance of their activities in Mexican territory, by means of a deposit in the accounts referred to in section I of article 141 of the Federal Tax Code.
Income from salaries and in general for the rendering of subordinated personal services paid by residents abroad, individuals or legal entities that do not have a permanent establishment in the country or that having one, the service is not related to such establishment, are exempt from the payment of the tax referred to in this article, provided that the stay of the service provider in Mexican territory is less than 183 calendar days, consecutive or not, in a period of twelve months.
The provisions of the preceding paragraph will not be applicable when the person paying for the service has an establishment in Mexican territory with which said service is related, even if it does not constitute a permanent establishment under the terms of Articles 3, 168 and 170 of this Law, as well as when the provider of the service to said establishment receives complementary payments from residents abroad, in consideration of services rendered for which he has obtained income subject to withholding in accordance with the third paragraph of this Article.
The taxpayer who is obligated to pay the tax under the terms of this article, will be obligated to continue paying it, as long as he/she does not demonstrate that he/she has remained for more than 183 consecutive days outside the national territory.