Mexico VAT Registration: Full (Permanent Establishment) Registration vs. Digital Services

What you'll learn

This guide explains Mexico's two VAT registration options—for businesses with a Permanent Establishment (PE) and for non-resident digital service providers. We've made complex tax requirements simple to understand so you can make the best decision with confidence.

Full (Permanent Establishment) Registration

When to choose Full Registration:

• You have physical presence in Mexico (office, staff, warehouse)

• You import and store goods in Mexico before selling them

• You need to recover input VAT on your Mexican purchases

• You sell to both businesses and consumers in Mexico

• You want full participation in the Mexican tax system

Key features:

• Full RFC registration with the Mexican Tax Administration (SAT)

• Input VAT recovery on eligible purchases

• Monthly filing by the 17th of each month

• Local fiscal representative required for foreign businesses

• Tax invoice issuing capabilities

• CFDI e-invoicing system compliance

What to expect:

• More complex compliance requirements

• Detailed monthly reporting

• Standard 16% VAT rate (8% in border regions)

• Complete Mexican tax obligations

• Need to work with a local tax advisor, Taxually cannot support this type of registration

Digital Services Registration

When to choose Digital Services registration:

• You're a foreign business with no physical presence in Mexico

• You provide digital services or content to Mexican consumers

• You operate a digital platform or marketplace

• You don't need to recover input VAT

• You want streamlined VAT compliance

Key features:

• Simplified RFC registration for non-residents

• No input VAT recovery

• Monthly filing requirements

• Local fiscal representative required

• Streamlined reporting focused on digital transactions

• Monthly reporting by the 17th of the following month

What to expect:

• Focused registration for digital service providers only

• Cannot recover input VAT paid in Mexico

• Standard 16% VAT rate applies

• Electronic receipts must be issued to customers

• Simplified compliance compared to full registration

Quick Comparison

Making Your Decision

Choose Permanent Establishment Registration if:

• You have business operations in Mexico

• You need to recover Mexican input VAT

• You import and store goods in Mexico

• You sell to both businesses and consumers

Choose Digital Services Registration if:

• You're a foreign business with no Mexican presence

• You only provide digital services to Mexican customers

• You don't need to claim input VAT credits

Need Help?

We're here to support you. If you're unsure which registration type fits your business, just reach out to our team and we'll guide you through the decision. If needed, we are happy to refer you to a local partner.