The Accommodation Services Tax Law, passed by the Congress of the Mexican state of Quintana Roo at the end of 2019, obliges all those who rent out accommodation to comply with tax obligations to the Tax Administration Service (SAT). The law came into force in January 2020 and also applies to users of digital housing rental platforms such as Airbnb or Booking.com. The platforms themselves were treated like hotels and forced to pay taxes.
Airbnb honestly collected 3% occupancy tax (ISH) from everyone who rented accommodation through this platform and transferred it to the local budget, without identifying clients. Although the platform was required to obtain an operating license as a tax agent and report its clients' data to the State Tax Administration Office, it apparently did not do so, since it never required an RFC taxpayer number to be provided to a certain point.
But the Law contained 2 more criteria: 1) everyone who rents out housing through a digital platform is required to register in the State Register of Taxpayers and, accordingly, have an RFC tax number, 2) have a municipal operating license (license to carry out commercial activities).
Of course, while Airbnb did not report the tax data of its clients to the tax authorities, no one registered the RFC and received a license. But the situation changed when the Mexican government made all e-commerce platforms and their users pay income tax (ISR) and VAT. The platform must collect these taxes from all income of its clients and transfer them to the budget (plus local accommodation tax), and at the same time report the data of these clients to the tax authorities. The obligation became applicable on July 1, 2020, and reached placement platforms on October 1. Airbnb began requiring users to provide a tax RFC number, and those who did not have or did not provide one began to be considered tax non-residents, subject to much higher tax rates (36% overall).
Since some of the taxes collected are then redistributed to municipalities, there is nothing stopping SAT from transmitting taxpayer data to local levels. This is where the requirement of the Quintana Roo Accommodation Service Tax Law came into play, obliging landlords to obtain a municipal license. Municipal employees began going door to door and asking to see an operating license. Of course, they came to those who did not have such a license.
It is allowed, municipal workers only had to open Airbnb and see who is renting out the accommodation, although the platform does not show the owner’s address and contacts until payment is made. Under any circumstances, it has become impossible to rent out housing through Airbnb without paying taxes, and if housing is rented through the platform, it means that the owner has provided SAT with personal information and is required to have a municipal license.
Vulnerable segments of the population whose income from renting housing does not exceed 120 UMA (conventional unit of account, equal to 86.88 MXN for 2020), or 10,426 MXN per month, were excluded from the criterion for purchasing an operating license. In this case, the owner should rent out the housing to him. Pensioners are also excluded from the requirement to obtain an operating license.
If you have not yet been asked to show your operating license, you will be asked. It is prohibited to rent out housing without a license; it has the right to be sealed. May impose a fine — several tens of thousands of pesos for engaging in commercial activities without a license. But you have the opportunity to try to negotiate with a municipal employee. And then it’s still worth acquiring a license.
To obtain an operating license, you must contact the municipality. You need the same service that handles business registration and issues various business licenses. Operating license (Licencias de Funcionamiento) — This is a license to engage in certain commercial activities. The list of papers required to obtain a license may differ in each municipality, but always includes RFC and receipts for payment of housing tax (impuesto predial), payments for land use, garbage collection, etc. Information can be found on the website of a specific municipality.
The license is issued within 1 to 5 days; the tariff also depends on the municipality, zone and status of the property. In Cancun, purchasing a license is free of charge (possible, due to the coronavirus epidemic), in Tulum its cost is 1-5 UMA (87 — 434 MXN). The license is issued for a year.
A foreigner can only obtain an operating license if he or she has resident status. Firstly, a foreign citizen without residence, as a rule, is not able to obtain an RFC, and secondly, a non-resident has no right to engage in commercial activities in Mexico.
If you purchased property in Mexico through the opening of a bank trust, the bank could purchase a temporary RFC for you even if you did not have a residence. Try to obtain an operating license on this basis.