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High subsidies!Mexico's RFC Tax Identification Number Registration Limit Subsidy Program Is Coming
October 25, 2022
Many sellers currently operating in North America know that the Mexican market can be called a “fighter in the blue ocean” due to its low competition and rapid growth!
In addition to the North America Logistics Remote Fulfilment Program (“NARF” for short), sellers who want to become more involved in the Mexican site can also choose to register an RFC tax identification number to start Mexican FBA inventory and sales, and sell well on Amazon Mexico with peace of mind!
01 What is an RFC tax identification number?
The Mexican RFC Tax Identification Number (Número del Registro Federal de Contribuyentes RFC Tax Identification Number) will determine the monthly VAT and income tax withholding amounts calculated by Amazon.
For sellers who use a local warehouse in Mexico and do not provide an RFC tax identification number, Amazon will collect up to 36% of tax (20% income tax ISR +16% VAT IVA) to the Mexican government. Sellers who are creating Mexican FBA shipments for the first time also need to upload an RFC tax identification number in Amazon Seller Central to activate the FBA feature.
02 Am I obligated to register an RFC tax identification number?
If you meet any of the following conditions, you are obligated to register an RFC tax identification number and enjoy relevant tax facilitation policies:
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① I am a Mexican resident and sell products in an online store in Mexico;
② I'm a Mexican resident, but I sell products in a non-Mexican online store;
③ I'm not a Mexican resident, but I have an online sales office in Mexico;
④ I'm not a Mexican resident, but I have inventory within Mexico.
✦ ✦ ✦ ✦ ✦ ✦ ✦ ✦
① I am a Mexican resident and sell products in an online store in Mexico;
② I'm a Mexican resident, but I sell products in a non-Mexican online store;
③ I'm not a Mexican resident, but I have an online sales office in Mexico;
④ I'm not a Mexican resident, but I have inventory within Mexico.
✦ ✦ ✦ ✦ ✦ ✦ ✦ ✦
Simply put, without an RFC tax identification number, if the order is shipped from Mexico (FBA warehouse, overseas warehouse) and delivered to a Mexican consumer, up to 36% of the tax will be withheld from the order.
Note: Orders shipped from overseas or shipped from NARF from the US to Mexico are taxed during the customs clearance process and are not affected by the new Mexican tax reform policy, and sellers are not required to apply for an RFC tax identification number.
03 What are the advantages of registering an RFC tax identification number?
The advantage of registering an RFC tax identification number is that you can start FBA sales in Mexico. At the same time, it also makes your tax filing methods more flexible, no tax withholding, and more friendly to cash flow management!
You can check the proxy tax requirements for different types of sellers using the table below:
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Note: Withholding tax vouchers will be posted to your tax documents within the first 10 days of each month (please go to Mexican Tax Invoicing Options).
Note: Withholding tax vouchers will be posted to your tax documents within the first 10 days of each month (please go to Mexican Tax Invoicing Options).
⭕ If you want to know more, visit Amazon Seller Central and check the Mexican VAT FAQ by clicking on this link
New Seller Onboarding Guide Video
Before entering Amazon, please read the registration guide video, prepare relevant registration materials in advance, understand the specific registration process, and help you start a store smoothly!
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