- Starting January 1, 2026, Mexico will expand VAT and income tax withholding rules on digital platforms to include B2B (business-to-business) sales, affecting both local and cross-border sellers.
- Platforms must withhold 50% of VAT and 2.5% income tax from Mexican business sellers with a valid RFC; if no RFC is provided, they must withhold 100% of VAT and 20% income tax.
- The income tax withholding rate for individual sellers will increase from 1% to 2.5%.
- For cross-border transactions, platforms must withhold 100% of VAT on sales by foreign sellers or when proceeds are paid to foreign bank accounts.
- Platforms and sellers must update their systems and ensure accurate RFC and payment information to comply with the new rules.
Source: fonoa.com
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
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