Mandatory Electronic Invoicing in Mexico
Learn how to get your company ready to exchange documents in accordance with regulations in Mexico with the support of Comarch
Mexico's E-invoicing regulation has been gradually introduced to become mandatory for all taxpayers since 2014. Mexico was one of the earliest countries to implement that solution and is considered a pioneer in the LATAM region.
The electronic services of the Mexican tax authorities, SAT services, are mandatory for issuing invoices and other kinds of accompanying receipts (in the case of verifying electronic invoices, this has been delegated to certified PAC providers).
The issuer must communicate the invoice to the recipient within three days following issuance. The issuer has to be capable of providing a printed copy if the buyer requires this.
Each invoice must be signed with the supplier's CSD (certificate issued by the tax authorities) and then sent to the Authorized Certification Provider (PAC). The PAC is a Tax Administration Service authorized entity verifying the XML format. It also assigns the folio (UUID) and signs it with the key provided to the tax authority. PAC performs these processes known as "Timbrado" and returns the result to the supplier (or service provider).
The PAC also places a Digital Seal to authenticate the CFDI from its origin since the issuer and the receiver must have their respective Digital Seal Certificates (CSD) up to date. If the SAT suspends them for some reason (for ex., tax delinquency), then the tax receipt cannot be generated.
Mandatory XML formats are specified by the Mexican tax authorities (‘SAT’), with several variations depending on their intended reporting use.
There are five main types of invoice formats:
Keeping original electronic documents archived for at least five years is mandatory - both by issuer and recipient.
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If your company is based or has branches in the Mexico and you need to prepare your billing and tax systems to comply with the new requirements. Click on the button below to get in touch with one of our experts.