If you’re an expat spending time in Playa del Carmen, Cozumel, or Tulum and wondering whether Mexico wants a slice of your Social Security, foreign pension, investment or rental income—you’re not alone. For thousands of expats living in Quintana Roo, the question of foreign income taxation depends on one key factor: your tax residency status.
Understanding Tax Residency in Mexico
Mexico’s Servicio de Administración Tributaria (SAT) determines tax residency under two main criteria:
- 183-Day Rule: Spend more than 183 days in Mexico within a calendar year (consecutive or not), and you’re considered a tax resident.
- Center of Vital Interests: Even if you’re here less than 183 days, you may still qualify as a resident if Mexico is where your principal home, family, or main source of income is based.
Once you’re classified as a tax resident, you must report and potentially pay Mexican taxes on worldwide income, including pensions, investment dividends, and rental income from abroad. Non-residents, however, are taxed only on income earned within Mexico.
How It Works in Practice in Quintana Roo
For now, enforcement in Quintana Roo remains focused on local earnings—employment, business profits, and rental income from Mexican properties. Seasonal residents who split time between Mexico and their home countries usually fall outside SAT’s worldwide income net. Still, as digital banking, real estate transparency, and data-sharing agreements expand, SAT is gaining better visibility into cross-border finances.
Mexico has tax treaties with over 50 countries, including the U.S. and Canada, which prevent double taxation. These allow you to offset taxes already paid abroad through foreign tax credits. So, if you’ve paid income tax on your pension in your home country, you likely won’t pay it again here.
Staying Compliant
If you’ve made Quintana Roo your full-time home, or are close to crossing the 183-day threshold, it’s smart to register for a RFC (Registro Federal de Contribuyentes) number and maintain meticulous records of foreign income, tax payments, and days spent in Mexico.
Tax returns in Mexico are due April 30 for individuals, and SAT’s digital platform now allows online filing.
The Bottom Line
Are expats in Quintana Roo taxed on foreign income? Technically, yes.
Mexico can tax foreign income from residents, but in practice, most expats in Quintana Roo, especially part-timers, will owe little or nothing beyond what they’ve already paid at home. The key is clarity. Know your residency status, track your days, and review your country’s treaty with Mexico.
When in doubt, consult a binational tax advisor who understands both systems. Because in Mexico, even paradise comes with paperwork.
