MEXICO Law and Practice Contributed by: Jesús Aldrin Rojas, Miguel Ángel García Piña and Esteban Ollervides Toribio, QCG Transfer Pricing
5.2 Secondary Transfer Pricing Adjustments In line with 5.1 Upward Transfer Pricing Adjustments , the Mexican tax authorities have established, through the Miscellaneous Tax Resolution in Rule 3.9.1.1., the different types of transfer pricing adjustments. These include: • voluntary or compensatory adjustments; • primary adjustments; • domestic or foreign correlative adjustments; and • secondary adjustments. A secondary adjustment is defined as: “An adjustment that results from the application of a tax contribution, in accordance with the applicable tax legislation, after a transfer pricing adjustment has been determined for a transaction. It is generally characterised as a deemed dividend.” For a more detailed discussion of the tax consequenc - es arising from deemed dividends in the transfer pric - ing context, see 8.1 Transfer Pricing Penalties and Defences . 6. Cross-Border Information Sharing 6.1 Sharing Taxpayer Information Mexico has an extensive network of double taxation treaties – currently over 60 in force – as well as at least 16 comprehensive information exchange agree - ments with countries considered to have preferential tax regimes. One of the key instruments is the Multilat - eral Competent Authority Agreement on the Exchange of Country-by-Country Reports. The domestic legal basis for information exchange is found in Article 69 of the Federal Tax Code, which, while imposing a general duty of tax secrecy, express - ly authorises the exchange of taxpayer information with foreign authorities pursuant to tax treaties, broad exchange of information agreements, and the Multilat - eral Convention on Mutual Administrative Assistance in Tax Matters. 6.2 Joint Audits Mexico actively co-operates in international tax enforcement through co-ordinated or simultaneous
audits. These audits are legally supported by Article 42 of the Federal Tax Code (CFF), Articles 25 and 26 of double taxation treaties based on the OECD Model, and the Convention on Mutual Administrative Assis - tance in Tax Matters (MAAC). This multilateral instru - ment enables the exchange of information, assistance in tax collection, and the conduct of joint audits. Although the legal framework robustly supports these forms of co-operation, in practice co-ordinated and simultaneous audits remain selective and are initiat - ed on a case by case basis, primarily with key treaty partners (see 6.3 Simultaneous Controls for further detail). In addition, Mexico has adopted the Multilateral Instru - ment (MLI), which automatically modifies provisions of existing treaties to implement BEPS minimum stand - ards. These standards include the Mutual Agreement Procedure and measures aimed at effective dispute resolution, such as simultaneous reviews. It should be noted that Article 42 of the Federal Tax Code was amended in November 2025. This amend - ment reinforced the taxpayer’s right to be informed during the exercise of audit powers, including the obli - gation of the SAT to establish a procedure for inform - ing the taxpayer of the opportunity to attend its offices during the audit process. 6.3 Simultaneous Controls Mexico does co-operate in simultaneous tax con - trols, particularly in transfer pricing audits involving multinational groups. However, such controls are not routine and generally occur on a case by case basis with treaty partners. The legal framework for this co-operation is primarily grounded in Article 69, sixth paragraph, of the Federal Tax Code, which expressly authorises the exchange of information with foreign tax authorities pursuant to tax treaties, broad exchange of information agree - ments and multilateral conventions. This framework is complemented by the relevant provisions of the Miscellaneous Tax Resolution, currently Rule 2.1.2, which define and recognise Mexico’s tax treaties and its participation in the OECD Convention on Mutual Administrative Assistance in Tax Matters as qualifying broad exchange of information agreements.
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