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Mexico: Proposal to impose income tax on gifts, inheritances, legacies

Mexico proposal, revise taxation of gifts, inheritance

A proposal would revise the income tax treatment of certain gifts, inheritances, and legacies and would subject certain of these transfers to income tax.


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The proposal (announced in August 2018 in the gazette of the Chamber of Deputies) would impose income tax on certain gifts, inheritances, and legacies that exceed 10 million pesos (approximately U.S. $521,000), regardless of the source or location of the estate (thus, basis on world-wide income). Under the proposed measures, there would be a new requirement to make provisional payments of tax according to certain specifications.

According to the proposal, only gifts between spouses or transfers involving “straight-line” or direct descendants would be exempt from tax. Currently, individuals who are tax residents of Mexico are exempt from having to pay income tax (impuesto sobre la renta (ISR)) on receiving inheritances or legacies. Similarly, gifts received by spouses or by direct descendants are generally exempt (with certain exceptions). The exemption from tax applies for the entire amount received.


Read an August 2018 report (Spanish) prepared by the KPMG member firm in Mexico

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