February 2, 2021
Mexico establishes threshold for reporting customized transactions under the mandatory disclosure regime
Taxpayers or tax advisors must report customized transactions with an aggregate tax benefit of more than $100 milion Mexican pesos (approx. US $5 million) under the mandatory disclosure regime (MDR). Under transitory provisions, the initial reporting date is February 15, 2021, for most transactions.
On February 2, 2021, Mexico's tax authorities established that customized transactions with an aggregate tax benefit of more than $100 million Mexican pesos (approx. US $5 million) are subject to the MDR reporting requirement. For more information on the MDR, see Tax Alerts 2020-0625 and 2020-2594.
The threshold does not apply to generic transactions or transactions that meet the hallmark for avoiding the exchange of information with foreign authorities.
To determine whether the threshold is met, taxpayers or tax advisors must aggregate the tax benefit for all transactions that meet a hallmark for reporting and have at least one tax year in common.
As discussed in previous Tax Alerts, reportable transactions are classified as either generic or customized transactions. A generic transaction is designed to be marketed on a large scale to all types of taxpayers or to a specific group. A customized transaction is one designed, marketed, organized, implemented or administered for a taxpayer's particular circumstances.