VAT Refunds In Mexico: What To Expect

When a company in Mexico has a value-added tax (VAT) credit, it may request a refund from the tax authorities. While this is a straightforward concept, in practice, obtaining a VAT refund is rarely a simple process.

Setting expectations is challenging, particularly regarding the timeframe and level of detail required in supporting documentation. A useful rule of thumb is to assume that the refund process will involve a comprehensive review of all transactions giving rise to the VAT balance, including their origin, business purpose, and traceability.

While the statutory timeframe for the tax authorities completing a VAT refund is 40 business days, in practice the process usually takes longer, since the clock stops when there are additional requests for information, and, in practice, almost always additional requests will be made.