VAT tax in Mexico

[Peter-and-Wendy2]

I have 2 separate questions regarding the VAT taxes collected by Airbnb on the rentals of my Mexican property:

1) As I host, I must pay VAT tax on the hosting fee which I pay to Airbnb.  I understand and accept that. Airbnb sends me an invoice/receipt which shows the fee and the VAT tax which they charged me.  However, my Mexican accountant just told me that since my RFC number does not appear on this receipt, the receipt will not be accepted by the Mexican tax authorities.  How can I get a receipt with my RFC number on it?

2) As a guest, my guests are supposedly charged and pay to Airbnb a 16% VAT tax for Mexico.  My accountant advises me that I should get a print-out of all RFC taxes paid for my property or I will be liable to pay them again when the tax authorities see my income.  How do I get proof of VAT taxes paid on my property rentals?

[Peter-and-Wendy2]

Thanks!  Also discovered that if you’re not signed in, the Reply does not post. 

[John5963]

Hi, we are usa citizens living in florida. We recently started renting on airbnb and have a property manager in playa del carmen. Is airbnb paying all three of these taxes?

ISR	VAT	ISH
Income tax	Value Added Tax	Lodging tax
Airbnb makes a monthly retention for ISR, according to the types of income obtained in the month, applying a rate of 4% if you offer the accommodation service or 1% if you offer adventure and experience services*. If you do not provide your RFC, Airbnb will withhold 20% of your income. You can subtract these withholdings from the tax that results in the month. You can choose to consider these withholdings as final payment.**	Airbnb makes a withholding for half of the VAT; that is, an overall 8%. If you do not provide your RFC, Airbnb will withhold 16% VAT; that is, the whole. You can subtract these withholdings from the tax that results in the month. You can choose to consider these withholdings as final payment.**	Airbnb already collects this tax and pays it to the state treasury if your space is in Mexico City, Quintana Roo, State of Mexico, Baja California, Baja California Norte, Yucatán, Oaxaca and Sinaloa. If your space is in another State, you have to collect this tax from your guest or client, and pay it to the Treasury.

Are we, personally, supposed to be paying more taxes and need an accountant in Mexico to do this or is what airbnb is depositing to our bank accounts ours to keep and all taxes are paid by airbnb?

[Peter-and-Wendy2]

We too would appreciate knowing the correct answers to John's questions.  We have not received satisfactory or clear answers from Airbnb personnel in the past.  Thank you!

[Daniel433]

Daniel Botha here, vat tax in Mexico. My  Mexican accountant keeps on telling me the vat tax Airbnb charges is not acceptable to the SAT office, as the invoice Airbnb issue is not according to the prescribed format required by SAT.   The issue also is my accountant also deducts 16% from my earnings.  I do not know what is happening to the Airbnb deductions from my account, but SAT is not accepting it, so even if SAT is getting that they do not credit my account accordingly. My accountant's opinion is that the Airbnb vat tax is a mess, much worse than VRBA apparently.  Also when I look at my statements from Airbnb is it lacking crucial information for tax purposes. All expenses Airbnb deducts should be clearly indicated so that my accountants can see it and handle it accordingly. 

I would highly appreciate it if Airbnb can put an urgent effort to rectify this. This has been going on for more than 6 months now and I do not see any improvement in the Airbnb account recording system. 

[Daniel433]

My RFC information is on the Airbnb site since April 2021 

[Daniel10214]

Hey Daniel,

Question, did you have to become a Mexican resident in order to obtain an RFC??

Thanks

[Peter-and-Wendy2]

Daniel,

Sorry to report that "misery loves company" and that is why I am replying to your message.  I have not totally given up yet, but I don't understand why Airbnb and VRBO for that matter are collecting and reporting taxes to the Mexican authorities AND issuing U.S. 1099's to me for the same income.  I understand it to be that there is a North American U.S., Mexico & Canada) agreement that double taxation will not occur.  However, I believe I will end up paying taxes in both the U.S. and Mexico.  I am a Residente permanente living full-time in Mexico where my rental property is.  But, I have as much of my rental income as possible deposit into my U.S. accounts.  Maybe that's a mistake and that's where my problem lies; but, NO ONE at Airbnb (or at VRBO to be fair) can explain any of this to me.  I've picked up more nuggets of truth and accuracy through these threads.  Good luck!

[Sarah977]

@Peter-and-Wendy2  I don't know why Airbnb can't explain it to you, other than that their reps are clueless, and, to be fair, they aren't tax experts for every country in the world .

It's simple-  as a US citizen, you have to report your worldwide income to the IRS. (The US and Eritrea are the only countries in the world that tax their citizens as opposed to their residents) You have to pay taxes on it in both Mexico and the US. 

The tax treaty which prevents double taxation doesn't mean that you don't report the income in both places- it means that the tax you paid in Mexico will be deducted from the tax you owe in the US. Depending on the rate that income is taxed in the US, you may end up having to pay more in the US, or nothing. 

And, as far as I know, you can also deduct all receipts for expenses on your US taxes, whereas in Mexico, you can only deduct what you get official facturas for with your RFC number on them.

[Peter-and-Wendy2]

Thanks Sarah.  Seems like you give a simple enough explanation that web site representatives could not.  Now I just have to figure out how I can complete and file my U.S. taxes before I have my final tax numbers that I will pay in Mexico.  Appreciate you sharing your knowledge.  Be well.

[Peter-and-Wendy2]

And I'd like to respond directly to Daniel that his VAT/IVA Mexican tax problems are also my own.  I use a very competent and knowledgeable Mexican accountant who consistently claims to us that the booking sites are not filing their withholdings to the Mexican tax authorities properly nor submitting adequate documentation to us, the taxpayers.  Hang in their Daniel.  Someone must have a handle on this mess.  Maybe?

[Sarah977]

@Peter-and-Wendy2 Yes, I'm just trying to figure that out myself now. I just hooked up with a Mexican accountant who seems quite knowledgable about that stuff, and milagro de milagros, got an email from an Airbnb rep who gave me the clearest answer I've ever gotten from Airbnb about anything. He said Airbnb is collecting the IVA, which they charge to the guest, that they submit it to SAT and that I have to charge the lodging tax myself and submit it to SAT. And that we must fill out the "Facturify" form, not just give Airbnb our RFC #.

Whether that will actually pan out to be true or be a big mess, as you say, remains to be seen.

[Catherine2842]

@Sarah977 Can you tell me how you accessed Facturify to begin issuing facturas?  Did Airbnb send you a link or?  When I spoke with Airbnb about accessing Facturify, they told me they had no relationship with this 3rd party company.  Soooo frustrating.

[Peter-and-Wendy2]

Catherine,

In our case, we just started receiving notices from Facturify at some point unsolicited.

We had never heard of Facturify until we received our first statement.

I gave up trying to ask for anything legal from Airbnb staff.

Not worth the runaround.

In our case, that works because the least of our bookings come via them.

Pete & Wendy

[Lizbeth55]

Hi, if you don’t mind me asking where do most of your bookings come from. I just started hosting on Airbnb for a property in mexico and am having a hard time with the runarounds. 

[Peter-and-Wendy2]

Actually, the majority of our bookings are from referrals & returns and VRBO.co,

Very few of our inquiries come via Airbnb.