Mexican Earnings - Taxable or not??

QUESTION:

Hi David. I am a Canadian living in Mexico with a Mexican Visa. I have no income from Canada. I have invested in a Mexican Co. via a Mexican broker that trades on the Mexican Stock Market.

How should I treat the profit from this investment. Thank you and I appreciate all the work you put into this forum.


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david ingram replies:



I passed this question to my associate David Holroyd (a US – Canada - Mexico consultant) who still spends half the year in Mexico and lived in Guadaljara for 10 years or so.



David Holroyd replies:



Since he is a Mexican resident and the money comes from Mexican sources

the SHCP has the right to tax this income.



There are specific headings on the Mexican forms for interest and dividends. The problem comes with

capital gains, for which there does not appear to be a separate heading.





The taxpayer could lump them in with dividends. If the questioner does

not already have a number for the Registro Federal de Contribuyentes he

has to go to his nearest Hacienda (SHCP) office and apply for one.



He will receive a CURP number at the same time. The number from the RFC and

CURP will both be shown on the tax form. Unfortunately he will then have

to file regular reports every 2 or 3 months to report his investment income.