TAX CONSULTANCY

The Mexican tax system is extremely complicated, it is not easy to understand and, therefore, it is not easy to have certainty in its application. This is due to an over-regulated structure in some aspects and a significant lack of conceptual clarity.

To this we must add the complexity that tax matters have by virtue of their very nature, which makes it indispensable to interweave different branches of law, together with accounting techniques.

Often, this represents a whole interpretative requirement and a conjugation of rules, as in the case of the enormous influence that tax law has on figures such as mergers, spin-offs and liquidation of commercial companies, or on the distribution of dividends, the reimbursement of contributions and the integration of accounting.

The same happens, for example, with the conceptual mishmash embedded in the provisions that regulate the “cost of goods sold” -cost of sales-, as a result of which one of the most relevant deductions in income tax must be configured not only in light of public law provisions, but with the support of the regulations used for the preparation of financial statements: the financial reporting standards issued by the Mexican Financial Reporting Standards Board, A.C. (Consejo Mexicano de Normas de Información Financiera, A.C., CINIF).

In this context, the legislator, the Federal Judiciary, the Federal Court of Administrative Justice and the Tax Administration Service (SAT) itself have created a broad and complicated framework of provisions that must be taken into account jointly -for analysis and application purposes-, and which have gone to the extreme of defining the terms in which commercial, corporate and business operations in general are agreed upon.

There is no doubt, therefore, that in the business environment, it is essential to have certainty regarding the tax effects of the decisions taken.

The same applies to personal assets: their permanent protection, with a tax focus, is essential to keep them undiminished and free from contingencies.

Hence the relevance of having advice provided by trained professionals with extensive and proven experience in solving complex problems and situations.