VAT Registration in Mexico: What You Need to Know

Registering for VAT in Mexico requires a few steps that differ depending on whether your business is incorporated in Mexico, has a physical presence there, or sells only digital goods and services to Mexican consumers. This article covers the key requirements, the registration process, and what to expect.

Registration Thresholds

There is no dollar or transaction threshold for VAT registration in Mexico. Any taxable sale of goods or services, or any qualifying physical presence, creates a registration obligation. This includes sales taxed at 16%, 8%, and even 0% (zero-rated supplies are still taxable supplies and count).

Who Must Register

There are two main registration schemes:

Standard Registration applies to businesses that:

• Are incorporated in Mexico

• Have a fixed place of business in Mexico, such as an office, warehouse, or employees with sales authority

• Are importing physical goods into Mexico as the importer of record

Digital-Only Registration applies to businesses that:

• Are not incorporated in Mexico and have no physical presence there

• Sell only digital goods or services, such as SaaS, streaming, or apps, to Mexican consumers

• Have no permanent establishment in Mexico

Important: As of 2025, Mexico requires proof of a local domicile for digital-only registrations. This avenue is currently limited for foreign businesses without a Mexican address or representative. Please contact Kintsugi for guidance on how this affects your situation.

Required Documents

Regardless of registration type, you will need the following:

• Public deed or articles of incorporation (apostilled and translated into Spanish for foreign entities)

• Proof of a Mexican fiscal address, such as a utility bill or bank statement dated within the past four months

• Official ID of your legal representative

• Power of attorney or notarial document proving representation

• RFCs for all shareholders or partners (foreign partners without an RFC may use the generic RFC "EXT")

The RFC: Your Mexican Taxpayer ID

Before registering for VAT, your business must first obtain an RFC (Registro Federal de Contribuyentes). This is a taxpayer identification number issued by Mexico's tax authority, SAT.

RFC structure for businesses: 12 digits formatted as XXX-YYYYYY-ZZZ

• XXX = first three letters of the company name (foreign companies use "EXT" here)

• YYYYYY = two-digit year, two-digit month, and two-digit day of incorporation

• ZZZ = three alphanumeric digits randomly assigned by SAT

For individuals, the RFC is 13 digits. Non-resident businesses will see "EXT" at the beginning of their number.

Registration Process

Registration is done through SAT, Mexico's tax authority. You can register online or in person by scheduling an appointment.

SAT registration portal: sat.gob.mx

Important: The e.firma (Advanced Electronic Signature) is required to register and must be obtained in person at a SAT office. It must be renewed every four years.

When Registration Becomes Effective

Your VAT obligation begins on the date of your first taxable act. You must submit your RFC application and update your tax obligations within 30 days of that date. Digital suppliers are held to the same 30-day window.

Can You Voluntarily Register?

Mexico-based businesses can obtain an RFC before beginning sales activity, but VAT obligations only begin once taxable transactions start.

Non-resident businesses cannot voluntarily register for IVA unless they have a permanent establishment in Mexico or qualify for the digital-services registration scheme. There is no option to register "just in case."

Special Considerations

• Electronic invoicing is required. All VAT-registered businesses must issue digital invoices (CFDI) for their transactions.

• A local representative is required for foreign businesses with no permanent establishment in Mexico. This representative is jointly liable for any VAT debts.

• Marketplace withholding: If you sell through a platform that acts as a VAT-withholding agent, you are still required to remain registered and include withheld amounts in your returns. The platform's withholding certificate serves as your proof of payment.

Registration Type Comparison

Need Help?

Kintsugi handles Mexico VAT registrations from start to finish. If you are unsure which registration type applies to you, or if you need help gathering the required documents, reach out to our team and we will walk you through it.