top of page
  • Writer's pictureKay

Vacation rental in Mexico will be regulated by the new federal administration


Vacation rentals, like condominiums, apartments or entire houses became a great alternative to the conventional hotel during the last years. Online platforms, like airbnb.com, vrbo.com or homeaway.com are offering lodging and tourism experiences.

These companies do not own any of the real estate listings, nor do they host events. They act as a broker and are receiving commissions from every booking.


Airbnb was founded in April 2008 by Brian Chesky, Joe Gebbia, Nathan Blecharczyk. The platform is privately-held and headquartered in San Francisco with an estimated revenue in 2017 of 2.6 billion and a net income of USD 93 million

 

Listen to our podcast with Sean and Jennifer, two travel blogger at www.venturists.net, Airbnb guests and hosts. Learn more about how to use the platform, which questions to ask and what to look for when using airbnb.com


 

HOW IT STARTED

An air mattress in their living room and turning it into a bed and breakfast.

AIR BED'N BREAKFAST

2009, the name of the company was shortened to Airbnb.com, and the site's content had expanded from air beds and shared spaces to a variety of properties including entire homes and apartments, private rooms, castles, boats, manors, tree houses, tipis, igloos, private islands and other properties.

Airbnb in Mexico Since October 2017 the platform began to charge a 3% tax to Airbnb service providers located in Quintana Roo. According to the them, this tax has not been of greater impact on the arrival of tourists and their costs.

You might want to read: There is no UBER in Cancun


Uber in Cancun

Vacation Rental in Mexico

Cesar Martinez Faz, spokesman of president Andres Manuel Lopez Obrador mentioned plans where the host will be paying “income tax” (ISR) and the guest is paying 4% lodging tax. He is stating that this plan started as citizens' proposal and will take effect 1st of December 2019 and should be included in the budget of federal government expenditures in 2020.

The lodging tax will be split in half with 2% being dedecated to the promotion of tourism and 2% going to benefit the municipality in order to improve public places.

The Income Tax ISR (Impuesto sobre la renta) is a tax applied to people who are generating their income directly from activities as sales or rental of real estate properties, or the provision of services. The ISR is usually taken directly from profits that have been generated from commercial operations, like purchase, rent and also rendering of services.

The collection of this tax is considered an economic gain since it is the difference between the income (which can also come from many other sources) and the deductions that the government marks as authorized for all taxpayers.

Who has to pay ISR

Every person, residing in Mexico, regardless of their main source of income is from the sale, or rent of a product or the provision of a certain service.

Mexican citizens, whether by birth or by naturalization who have a residence abroad and who have a permanent establishment in Mexico, will pay an amount destined to ISR.

Residents abroad who obtain income from sources located in Mexican territory must participate in the payment of this tax, even if they do not have a permanent establishment on Mexican soil.


How much is the ISR

The amount paid or is retained by the concept of this tax, depends on the individual situation of the taxpayer and income that he has obtained during each fiscal year. Declaration can be done monthly, bimonthly, etc., and also depends on whether the status of the person presenting the payment is a natural person (persona fisica) or a legal entity (personal moral).

As mentioned before the amount, or rather the percentage to pay ISR, depends on several factors. The way to calculate the rate is mentioned in the Tax Law on Rent in article number 96 where it's explained.

Above is an example of an ISR calculation based on a monthly income of MXN 20,000 as shown on www.elcontribuyente.mx


Airbnb in Mexico

Mexico is following the example of other countries like the United States and Canada.

Transient occupancy tax (TOT) is charged in most of the United States, including California, to travelers when they rent accommodations (a room, rooms, entire home, or other living space) in a hotel, inn, tourist home or house, motel, or other lodging unless the stay is for a period of 30 days or more. In many cities, hosts must register with the government and obtain a permit or license and landlords or community associations may have restrictions on short-term sublets.

Airbnb has patents registered in countries like Ireland, the Netherlands and such where corporate tax is much more friendly and lower.

 

Have you been staying at a vacation rental in Mexico? We would love to hear your experiences and see your pictures. Please share some of them in our


travel community

and help others getting a "better picture" of the surroundings.

If you have any questions or concerns, please do not hesitate to write in the comment section below or send us an e-mail to: contact@kay.tours

Watch our vlog and subscribe to our channel to learn more about the Mayan Riviera.


Follow us: Instagram | Twitter | Facebook

Subscribe and listen to #kayspodcast on:

Spotify

Breaker

Castbox

RSS Sources:

https://sipse.com/

https://laverdadnoticias.com

https://www.eleconomista.com.mx/

510 views0 comments
bottom of page