Relocation tax guideMoving to Mexico: Taxes for Expats 2026
Mexico taxes residents on worldwide income at progressive rates up to 35%, with gains on listed shares at a 10% final tax (other gains at marginal rates), VAT at 16%, and no inheritance or estate tax. There is no special expat regime; residency turns on your centre of vital interests - chiefly a home in Mexico - rather than a simple day count.
Mexico has no headline incentive for new arrivals, and its residency test is unusual: it hinges on where your centre of vital interests sits, not on counting days. That makes it easy to become resident - and taxed on worldwide income - sooner than you might expect. This guide explains the residency test, capital gains, and the absence of inheritance tax.
Mexico: key tax rates
| Tax | Rate | Source |
|---|---|---|
| Corporate income tax | 30%Headline corporate income tax rate | PwC Worldwide Tax Summariesas of 2026-02-24 |
| Top personal income tax | 35%Top resident progressive rate | PwC Worldwide Tax Summariesas of 2026-02-24 |
| VAT / GST (standard) | 16%Standard VAT rate | PwC Worldwide Tax Summariesas of 2026-02-24 |
| Capital gains | TaxedGains on listed shares: 10% final tax; other capital gains taxed at marginal income-tax rates | PwC Worldwide Tax Summariesas of 2026-02-24 |
| Inheritance / wealth tax | NoNo inheritance or estate tax; inheritances are treated as income but generally exempt for tax residents | PwC Worldwide Tax Summariesas of 2026-02-24 |
When you become a tax resident
Mexico determines residency by your centre of vital interests, not a day count. If you have a home in Mexico, you are generally resident - unless more than half your income arises abroad and your main professional activities are elsewhere. Residents are taxed on worldwide income; non-residents only on Mexican-source income.
Source: PwC Worldwide Tax Summaries - Mexico (Residence) (as of 2026-06-24).
Residency is your centre of vital interests
Mexico does not use a simple 183-day rule. Instead, having a home available to you in Mexico generally makes you resident, and you are treated as having your centre of vital interests there if more than half your income in the year comes from Mexican sources, or if your main professional base is in Mexico.
The practical effect is that someone who sets up a home in Mexico can become a worldwide-income taxpayer quickly, even on relatively few days in the country. Anyone keeping ties elsewhere should confirm how the centre-of-vital-interests test applies, and whether a tax treaty resolves dual residence.
Capital gains and no inheritance tax
Gains on listed shares are taxed at a 10% final rate; other capital gains are generally taxed at marginal income-tax rates. Mexico has no inheritance or estate tax - inheritances are technically treated as income, but are generally exempt for tax residents. So estate planning centres on income and capital-gains treatment rather than a death duty.
Before you move: what to weigh
- A home in Mexico generally makes you resident - the centre-of-vital-interests test can catch you on few days.
- Residents are taxed on worldwide income at rates up to 35%; listed-share gains carry a 10% final tax.
- There is no inheritance or estate tax, though inheritances are treated as (generally exempt) income.
- US citizens remain taxable by the US on worldwide income; the Mexico-US treaty and foreign-tax credits then apply.
Get this right for your situation
Cross-border tax turns on your specific facts. Find a tax professional who works with people moving to Mexico.
Does Mexico tax foreign income?
Yes, for residents - Mexico taxes residents on worldwide income at rates up to 35%. Residency turns on your centre of vital interests, chiefly having a home in Mexico, so you can become a worldwide-income taxpayer without spending many days there. Non-residents are taxed only on Mexican-source income.
Does Mexico have an inheritance tax?
No - Mexico has no inheritance or estate tax. Inheritances are technically treated as income but are generally exempt for tax residents. Estate planning therefore focuses on income tax and capital-gains treatment (listed-share gains at 10%, other gains at marginal rates) rather than a death duty.
When are you a Mexican tax resident?
When your centre of vital interests is in Mexico - generally if you have a home there, unless more than half your income arises abroad and your main professional activity is elsewhere. It is not a day count. Residents are taxed on worldwide income; confirm whether a treaty resolves any dual residence.
Informational only, not tax advice. Cross-border tax depends on your personal circumstances and changes often; figures are dated to their sources. Confirm your position with a qualified professional before moving or filing.
Important disclaimer
Informational only — not tax advice. This page summarises publicly available information about tax in Mexico as of July 2026. Tax laws change, individual circumstances vary, and the application of any rule depends on your specific facts.
TaxProsRated does not provide tax, legal, accounting, or financial advice. Before acting on anything you read here, consult a qualified tax professional licensed in your jurisdiction (in the US: CPA, Enrolled Agent, or attorney; in the UK: CIOT- or ATT-qualified adviser; in Australia: TPB-registered tax agent; elsewhere: a locally-licensed equivalent). TaxProsRated, its operators, and its contributors disclaim all liability for action taken in reliance on this page.