On July 2, 2015, the Third Resolution of Modifications to the Miscellaneous Tax Rules of 2015 ("Third Modification") was published in the Federal Official Gazette ("DOF"). As part of the Third Modification, the Tax Administration Service ("SAT") added and amended several rules that may have an impact on companies with maquila operation, as provided by Articles 181 and 182 of the Income Tax Law ("ITL"). 

The modifications include the date of filing of the Informative Return of Manufacturing, Maquiladora and Exportation Services Companies ("DIEMSE") and the methodology for the calculation of the machinery and equipment ("M&E") utilized in the maquila operation.

Filing of DIEMSE

Through the filing of DIEMSE, rule 2.8.9.2. relieves the taxpayers from filing the Safe Harbor notice, provided by Article 182 of the Income Tax Law ("ITL"). Also,  if DIEMSE is filed, taxpayers are relieved from filing the notice referred to in Section II of Article First of the "Decree that grants tax incentives to the Manufacturing, Maquiladora and Exportation of Services Industry" published in the DOF on December 26, 2013.

The above shall be applicable only if the information declared in the DIEMSE is complete and duly presented.

Also, in accordance with Article Fifth Transitory of the Third Modification, DIEMSE shall be filed no later than December 31, 2015.

Calculation of the percentage of M&E utilized in the Maquila Operation

The Third Modification added rule 3.20.5 which provides the methodology of calculation of the percentage of M&E utilized in the maquila operation that shall be owned by the foreign related party ("Principal"). Failing to comply with this M&E ownership requirement, may trigger a risk of permanent establishment exposure in Mexico for Principal.

Methodology of Calculation provided by Rule 3.20.5 is the following:

  1. The percentage of M&E owned by the Principal, shall be equal to the amount pending to be depreciated from the M&E property of Principal divided by the amount pending to be depreciated from the entire M&E utilized in the maquila operation.
  2. The amount pending to be depreciated from the M&E property of Principal, shall be equal to:
    • Original investment amount ("MOI", as per its acronym in Spanish) of the M&E property of Principal minus its depreciated amount, accumulated until the last month of the fiscal year in which the M&E was utilized, calculated by applying the corresponding depreciation rates provided by the ITL for each specific good.
    • MOI shall be the value of goods declared at Customs at the date of its introduction into Mexico.
  3. The amount pending to be depreciated from the entire M&E utilized in the maquila operation, shall be obtained by adding the amount obtained in numeral 2 plus the following amounts:
    • If the M&E is property of a foreign third party with a business relationship with Principal, the amount pending to be depreciated from such M&E shall be equal to:
      • The MOI of the M&E minus its depreciated amount, accumulated until the last month of the fiscal year in which such M&E was utilized, calculated by applying the corresponding depreciation rates provided by the ITL for each specific good.
      • MOI shall be the value of the M&E declared at Customs at the date of its introduction to Mexico
    • If the M&E is property of the maquiladora company, the amount pending to be depreciated from such M&E shall be equal to:
      • The MOI of the M&E minus its depreciated amount, accumulated until the last month of the fiscal year in which such M&E was utilized, calculated by applying the corresponding depreciation rates provided by the ITL for each specific good.
      • MOI shall be the value of acquisition of M&E
    • If the M&E is leased by the maquiladora company, the amount pending to be depreciated from such M&E shall be equal to:
      • The MOI of the M&E minus its depreciated amount, accumulated until the last month of the fiscal year in which such M&E was utilized, calculated by applying the corresponding depreciation rates provided by the ITL for each specific good.
      • MOI shall be the value of the M&E declared at Customs at the date of its introduction to Mexico, if said M&E is leased from a foreign resident.
      • If the leased M&E is property of a Mexican resident, MOI shall be the value declared in the appraisal of the M&E, at the moment of the grant of its use, or at its physical delivery, whichever occurs first.  

The amounts pending to be depreciated that were calculated in accordance with the above, shall be updated due to inflationary effects from the month in which the M&E was imported, acquired or utilized, until the last month of the first half of the fiscal year in which the M&E was utilized. Also, said amount shall not be less than 10% of its corresponding MOI.