Main Taxes Paid by Legal Entities in Mexico

March 13, 2025

Incorporation of companies | Accounting

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In Mexico, companies (legal entities) must comply with various tax obligations. Knowing the main taxes they must pay helps them avoid fines and optimize their financial planning.

1. Income Tax (ISR)

The ISR It is a direct tax that is calculated on the company's profits. The general rate is 30% on taxable profit, although there may be tax incentives depending on the regime in which the company is located.

2. Value Added Tax (VAT)

The VAT It is a consumption tax that companies must charge on the sale of goods and services. The general rate is 16%, although there are products with a rate 0% or exempt. Companies must report and pay this tax periodically.

3. Special Tax on Production and Services (IEPS)

The IEPS It applies to specific products such as alcohol, tobacco, gasoline, and high-calorie foods. Not all companies pay it, only those that sell these products.

4. Payroll Tax (ISN)

This tax is levied by state governments and varies by state. It is calculated on the payment of salaries and wages to employees, with rates ranging from 2% and 3%.

5. Local Duties and Taxes

Depending on the business's nature, there may be other state or municipal taxes, such as operating licenses or land use fees.

Conclusion

Complying with these taxes is essential to avoid problems with the SAT (Tax Administration Service) and ensure the smooth operation of your business. Proper tax planning allows you to optimize tax payments within the legal framework.

In TaxIDWe help you manage your tax obligations efficiently. Contact us and ensure your company's tax compliance!

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