Below, we will outline the reportable schemes related to transactions with related parties that must be disclosed through an information return published for this purpose in the general provisions issued by the SAT (Mexican Tax Administration Service), specifically through the Miscellaneous Tax Resolution. Article 199 of the Federal Tax Code (CFF) defines a reportable scheme and its relationship to the tax benefit under Article 5-A of the CFF, including hypothetical scenarios that, if they materialize, must be reported to the tax authority and have the following characteristics:
- Schemes linked to transactions with related parties
- Return of full or partial payment for intercompany transactions.
In the case of related party transactions, these will be the intercompany payments or transactions that return all or part of the amount of the first payment that is part of that series.
- Transfer of hard-to-value intangible assets
When intangible assets that are difficult to value are transferred in accordance with the OECD transfer pricing guidelines, which we referred to above.
For better understanding, we would like to mention that an intangible asset is defined for transfer pricing purposes as one that:
“It is not a physical asset or a financial asset that can be owned or controlled for use in commercial activities and whose use or transfer would generate compensation if the transaction were carried out between independent parties under comparable circumstances” [1] .
Consequently, the CFF defines an intangible asset as difficult to value when:
“at the time the transactions are carried out, there are no reliable comparables or the projections of future flows or income expected to be obtained from the intangible, or the assumptions for its valuation are uncertain, so it is difficult to predict the final success of the intangible at the time it is transferred.”
- Corporate restructuring
In the case of corporate or business restructurings where there is no consideration for the transfer of assets, functions and risks, or when, as a result of such restructuring, taxpayers who pay taxes under the “legal persons” chapter of the ISR law reduce their operating profit by more than 20%.
This becomes especially relevant when, during the restructuring of a multinational group, there is a migration of intangible assets to countries where there are tax incentives or where the tax rate is favorable.
- Lack of remuneration in intercompany transactions
When goods and rights are transferred or the temporary use or enjoyment is granted, or services are provided or functions are performed that are not remunerated.
- There are no reliable comparables, as these are operations that involve unique or valuable functions or assets.
At this point it is worth mentioning that when transactions are agreed upon with related parties, these must be agreed upon on an arm’s length basis. Taxpayers who fall under this scenario are required to submit the transfer pricing study referred to in Articles 179 and 180 of the Income Tax Law, in which it is proven to the tax authority that the prices, amounts or profit margins are those used or obtained between independent parties in comparable transactions.
This can occur when in an intercompany transaction there is some intangible asset that, by its very nature, cannot be proven or demonstrated to the tax authority by a similar comparable, since it is unique, or when the comparable is not reliable due to the conditions and parameters implemented to demonstrate that the transaction was carried out as an independent third party would in comparable transactions.
- Transfer of a depreciated asset
Involve the transfer of a fully or partially depreciated asset, allowing its depreciation by another related party.
- Tax losses to obtain an authorized deduction
When there are tax losses whose deadline for reducing the taxable profit is about to expire according to the ISR law and operations are carried out to have taxable profits to which said tax losses are reduced and said operations generate an authorized deduction for the taxpayer who generated the losses or for a related party.
- Reverse sublease
In which the temporary use or enjoyment of an asset is granted and the lessee in turn grants the temporary use or enjoyment of the same asset to the lessor or to a related party of the latter.
Sanctions
Once the information return is filed, the SAT (Mexican Tax Administration Service) may request additional information from the tax advisor or taxpayer, who must comply with the request within a maximum of thirty days from the date the notification takes effect, under penalty of applicable infractions, which we will discuss later. Complying with this obligation, in the case of tax advisors, falls under the verification powers established in Article 42, Section XI of the Federal Tax Code (CFF), which states that the authorities are empowered to: “conduct on-site visits to tax advisors to verify that they have complied with the obligations set forth in Articles 197 to 202 of this Code.” In the hypothetical case of an on-site audit, the advisor is obligated to provide the documentation and information that supports their compliance with the disclosure of reportable schemes. Otherwise, even if the advisor is a taxpayer, they will be subject to the following fines:
In the case of infractions committed by tax advisors and related to the disclosure of reportable schemes, Article 82-A indicates which conducts deserve a pecuniary sanction and Article 82-B indicates the imposition of sanctions, the figures of which are updated in each fiscal year.
| Article 82-A Offenses committed by tax advisors | Article 82-B Amount of the penalty |
| Failure to disclose a reportable scheme, incomplete or erroneous disclosure, or late disclosure, unless spontaneous, constitutes a violation. Information is considered incomplete or erroneous when the lack of such information or the incorrect data substantially impairs the analysis of the reportable scheme. | From $62,390.00 to $24,952,660.00 |
| Do not disclose a widespread reportable scheme that has not been implemented. | From $18,710.00 to $24,950.00 |
| Failure to provide the reportable scheme identification number to taxpayers in accordance with article 202 of the CFF. | From $24,950.00 to $31,190.00 |
| Failure to comply with the request for additional information made by the tax authority or falsely stating that you do not have the required information regarding the reportable scheme in accordance with article 201 of the CFF. | From $124,760.00 to $374,290.00 |
| Not issuing any of the certificates referred to in the seventh paragraph of article 197 of the CFF. | From $31,190.00 to $37,430.00 |
| Failure to inform the Tax Administration Service of any changes that occur after the disclosure of the reportable scheme in accordance with the provisions of the penultimate paragraph of Article 202 of the Federal Tax Code. Likewise, submitting the information indicated in sections VI, VII, and VIII of Article 200 of the Federal Tax Code late, unless done voluntarily. | From $124,760.00 to $623,820.00 |
| Failure to submit the information return containing a list with the names, designations or business names of the taxpayers, as well as their key in the federal taxpayer registry, to whom tax advice was provided regarding the reportable schemes referred to in article 197 of the CFF. | From $62,390.00 to $87,340.00 |
Source: Prepared by the author based on information contained in the CFF (figures updated annually).
The taxpayer is also subject to penalty for failing to comply with the obligations relating to the disclosure of reportable schemes, article 82-C states the conduct attributable to an administrative infraction, and article 82-D, both of the CFF, the amount of the penalty as appropriate.
| Article 82-C Infractions committed by the taxpayer | Article 82-D Amount of the penalty |
| Failure to disclose a reportable scheme, incomplete disclosure, or disclosure with errors. Information is considered to be incomplete or erroneous when the lack of such information or the incorrect data substantially impairs the analysis of the reportable scheme. | The tax benefit provided for in the reportable scheme will not be applied, and an economic penalty equivalent to an amount between 50% and 75% of the amount of the tax benefit of the reportable scheme that was obtained or expected to be obtained in all the fiscal years that involve or would involve the application of the scheme will be applied. |
| Do not include the reportable scheme identification number obtained directly from the Tax Administration Service or through a tax advisor in your tax return in accordance with the provisions of article 202 of the CFF. | From $62,390.00 to $124,760.00 |
| Failure to comply with the request for additional information made by the tax authority or falsely stating that you do not have the required information regarding the reportable scheme in accordance with article 201 of the CFF. | From $124,760.00 to $436,680.00 |
| Failure to inform the Tax Administration Service of any changes occurring after the disclosure of the reportable scheme, in accordance with the provisions of the penultimate paragraph of Article 202 of this Code. Likewise, late reporting of the information indicated in sections VI, VII, and VIII of Article 200 of the Federal Tax Code. | From $249,530.00 to $2,495,270.00 |
Source: Prepared by the author based on information contained in the CFF (figures updated annually).
[1] OECD/IEF. OECD Transfer Pricing Guidelines Applicable to Multinational Enterprises and Tax Administrations, 2022 , OECD Publishing, Paris, 2025, [online] https://doi.org/10.1787/7063add0-es. [Accessed 30 April 2025]