Mandatory local contributions report for mexico city

Taxpayers whose level of operations, number of employees, real estate value, water consumption, or provision of lodging services falls within the thresholds established in the Mexico City Tax Code are required to submit a Local Contributions Report.

Obligated taxpayers

Individuals and legal entities are required to file the report when, in the year preceding the year subject to review, they have met any of the following conditions:

Maintained a monthly average of 150 or more employees;
Owned or possessed non-residential or mixed-use properties whose cadastral value, individually or collectively, exceeded $38,707,156.00 in any two-month period of the year;
Consumed, through one or more non-domestic or mixed-use water connections, more than 300 m³ of average bimonthly water consumption; or, in the case of one or more domestic-use connections, more than 1,000 m³ of average bimonthly water consumption, provided that the property where such water connections are installed was leased, in whole or in part;
Used water from sources other than Mexico City’s public water supply network and discharged such water into the drainage system;
Provided lodging services and, during the fiscal year under review, received consideration equal to or greater than $14,913,178.00 for such services.

Risks of non-compliance

Failure to file the notice, filing it after the deadline, omitting the report, or submitting it with incomplete or inaccurate information may result in fines, information requests, authority reviews, assessment of tax differences, inflation adjustments, surcharges, and other tax consequences. In addition, non-compliance may increase the taxpayer’s level of tax risk and affect the documentary traceability of its local operations.

Executive recommendation

Companies and individuals with operations in Mexico City should conduct an annual preventive review to identify whether they fall within any of the mandatory reporting thresholds. This review should include an analysis of the average number of employees, the cadastral value of real estate, water consumption, lodging service revenues, and any other applicable local obligation. For proper decision-making and compliance with this obligation, taxpayers should consult a certified professional with expertise in local tax matters.

For accurate and strategic decision‑making, it is recommended to always consult with a qualified professional from ZALDIVAR CONSULTING.