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Mexican Tax Law 2014
Electronic accounting Tax payers must upload monthly trial Balance to the tax administration office
Through a new IRS-mailbox, every company and individual must upload electronically the Trial Balance for the prior month, according to the monthly deadlines. This is a private portal accessed by username and password through the Tax Administration website.
For the first time the Trial Balance is send, the taxpayer must provide the chart of accounts approved by the IRS-Mexico. Everytime the chart of accounts change and/or add a new account, it has to be approved by the Tax Administration.
The Trial balance must show the balance at the beginning of the month, debits, credits, and the final balance of the month. These files are required to be provided in XML format.
The Mexican Authorities could request anytime book entries, with detail information of the transaction and the correspondent electronic invoice attached. It has to specify the tax rate applicable, withhold tax (if it is the case), and tax ID of the suppliers
CORPORATIONS
For corporations, electronic accounting records have to be sent starting on July 2014, nevertheless the Mexican Authorities write an extension to send them by January 2015 for the last semester of 2014. The filing deadline for each month is the 25th of the following month. The end of the tax year information, along with the corresponding tax adjustments for each tax year, is due by April 20th of the following tax year
Deadlines for 2014 Reporting Periods - Trial balance for the month Deadline
July 2014 | January 2015 |
August 2014 | January 2015 |
September 2014 | January 2015 |
October 2014 | January 2015 |
November 2014 | January 2015 |
December 2014 | January 2015 |
The annual information must be delivered no later than April 22, 2015 and must contain all tax adjustments.
INDIVIDUALS
For individuals, this obligation starts in January 2015. The filing deadline for each month is the27th, of the following month. For individuals, the filing deadline for each tax year is May 22nd of the following tax year.
THE ACCOUNTING
For the Tax Authorities, the Accounting must:
a). Be analytical and individual for each transaction, acts or activities in chronological order indicating the debit and credit of each account
b). Provide enough information to identify each fixed assets with electronic invoices or any other official document
c). Include financial statements: Balance Sheet, Income Statement, Cash Flow, Change in stockholder’s equity, and its notes.
d). Have all the information in spanish
e). Include bookkeeping, accounting records, and original documents which proof the transactions made such as electronic invoicing for each income and expense.
Information related to the accounting and journal entries would have to be provided electronically to the Mexican Tax Authorities upon request as part of an audit or review of the tax returns.
The communication between the taxpayers and the Mexican Tax Administration from now on will be only thru email. As the Tax Administration will be sending information and/or notice by e-mail, the electronic mail address provided to the Authorities must be checked to assure its reception.
Publications by the Tax Administration, about the requisites for the Electronic Accounting:
- Official gazette of February 2014
- Official gazette of April 2014
- Official gazette of July 2014
- Federal Tax Code modifications of October 29, 2013
The new format and modifications of the accounting data being requested by the Authority in Mexico will likely require many companies and individuals to modify the system and software they currently use to records their books. This may require substantial amendments to current accounting systems and record processes. Additionally, it would be important reviewing the trial balance to determine the changes that may be required in order to be able to submit the relevant requested information as indicated.
The complexity of the matters mentioned gives rise to certain legal and tax risks which must be evaluated.
Our Accounting Firm will be able to help you, outsourcing accounting services that meet the requirements requested by the authority.
For more information you can contact us: