The Mexican Tax Administration Service ("Tax Authority") has enabled the software that shall be utilized by maquiladora companies to file the Informative Return of Maquila Operations and Exportation of Services ("DIEMSE") correspondent to fiscal year 2014. Companies that operate in Mexico through "shelter" entities are also obliged to file the DIEMSE.
Filing software shall be accessed through the Tax Administration webpage, where the companies will have to fill the information required by the Tax Authority in DIEMSE for 2014.
It is important to bring to your attention that the Tax Authority deferred the obligation of filing the DIEMSE correspondent to fiscal year 2014 until March 15, 2016. Due date for DIEMSE 2015 remains the last day of June 2016, in accordance with second paragraph of Article 182 of the Income Tax Law.
Among the different data and amounts required upon filing of DIEMSE for 2014, the Tax Authorities have requested highly detailed information in connection with several aspects of the maquila operation of the filing companies, such as:
- Whether maquiladora companies determined its taxable profit utilizing the Safe Harbor method or an Advanced Pricing Agreement ("APA") with the Tax Authority.
- Detailed amounts of maquila and non-maquila income generated by the filing company.
- Tax and financial information, that
includes, among other, the following Value Added Tax
("VAT") monthly amounts:
- Creditable VAT
- Withheld VAT
- Shifted VAT
- Offset VAT
- Favorable balance of VAT requested in refund
- VAT refunded by Tax Authority
- Percentage of machinery and equipment ("M&E") utilized in the maquila operation that is property of the foreign principal, as well as figures regarding the calculation of such proportion (As per methodology provided by Miscellaneous Tax Rules).
- Information related with the calculation and application of the additional deduction of 47% of fringe benefits paid to employees.
- Amount of temporary and definitive importations, as well as amount of definitive exportations and return abroad of goods undertaken by the filing company.
Bear in mind that it is highly important to review the information required by DIEMSE 2014, given that its adequate filing entitles companies to continue applying certain maquiladora benefits, such as the additional deduction of 47% of fringe benefits to employees and the relief of filing the letter informing the Tax Authority about the taxable profit assessed by following the methodology resulting from the application of Sections I and II of Article 182 of the ITL.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.