Tag Archives: rentals

Renting a Property in Mexico

LIVING  IN A RENTAL HOME IN MEXICO…taking the big step by small measures!

by linda jones neil

 

Oftentimes it makes sense for newcomers to an area to rent a home prior to making a purchase.   This provides an opportunity to explore, to learn the neighborhoods, and then begin to understand the personality of the city or town before making a leap to a purchase and a more permanent commitment.

 

Everyday more and more foreigners, people from the U.S., Canada, Asia and Europe, have found Mexico to be an ideal location for healthy retirement.  Others have come to Mexico as a result of job transfers.  Others still, taking advantage of electronic and wireless communications, seek out delightful areas in which to live and work from their in-home offices and studios.

 

There are many areas in Mexico that offer opportunities for rentals and for retirement or vacation living:   Mazatlan, Puerto Vallarta, Manzanillo, Zihuatanejo and La Paz, Todos Santos, Los Cabos and the East Cape on the Baja Peninsula offer wonderful options on the seashore, as do Merida and the Riviera Maya on the Yucatan Peninsula.  Ajijic, Chapala and San Miguel de Allende are well established retirement areas with many rentals available.   Morelia, capital of the state of Michoacan, with its international airport and many cultural festivals is fast gaining importance as a retirement mecca.

 

In some areas, many homes or apartments may not be available for rent.  Fewer still may be fully furnished and ready for the international visitor.. It is not always the landlord’s custom to maintain the property.  A house may require fixing up, a refrigerator, a stove, basic furniture and lots of paint.   Nonetheless this can also be a fun experience for the couple who wants to learn about the area!   Rental terms can be from a few days  to indefinite, depending upon the owners.

 

Some of the questions to ask when looking for that special rental house or condominium are:

  1. What is the length of time the property is available for rental? (Some owners wish to rent only part of the year)
  2. What utilities are included in the rent? (Electricity, water, internet, cable?)
  3. What type of air-conditioning system/heating system does the property have
  4. Is telephone service available? Is cable service available?

 

  1. Is the water service reliable?

 

It is always a good idea to have a rental contract, in English, if you do not understand Spanish, which outlines the term of the agreement, the security deposit and conditions of its return, amount to be paid, extras, if any, and so forth.   This contact should be prepared by a rental management company.

 

It makes sense to contact a rental agency to assist in the search and to assist you with the details.   The professional agency will know the landlord and the time available for the rental, will be able to provide a history of repairs, and potential issues with the property.  It will also be able to help you locate the RIGHT house to meet your requirements..

. Copyright, 2010-2014, Consultores Phoenix, S.C. Reproduction prohibited without permission.

 

 

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Author Linda Jones Neil is the founder of The Settlement Company®, the first escrow company in Mexico, which is dedicated to processing the trusts and title transfers of Mexican real estate for foreign buyers and sellers for properties located ANYWHERE in Mexico. Ms. Neil is also licensed as a Real Estate Broker in California, is an Accredited Buyer Representative through NAR, and has over thirty five years of hands on experience in all aspects of Mexican real estate.  She holds membership in AMPI, NAR and FIABCI and PROFECO Certificate 00063/96.

 E-Mail; info@settlement-co.com  and website:  http://www.settlement-co.com

 

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PAYING TAXES ON INCOME ON RENTALS

MAKE LIFE SIMPLER!  DON’T SPEND IT WORRYING ABOUT COMPLIANCE!

 

Mexican newspapers are full of headlines about the growing problem of foreigners who are renting their homes or condominiums and failing to pay Mexican taxes.  Not only is this a violation of the terms of most bank trusts (fideicomisos), but also it is a violation of Mexican tax law and reprisals are severe.

 

FOREIGNERS ARE OBLIGATED TO PAY TAXES ON INCOME GENERATED IN MEXICO.  Mexico’s tax law is patterned after those of the United States and Canada (world rental system) which states in the First Article::

 

Article One: Physical persons (individuals) and legal persons (companies) are obligated to pay an income tax in the following cases:

 

I           Residents of Mexico, must report and pay on all income no matter where the source is located;

  1. Those with residence in a foreign country with a permanent establishment in Mexico must report and pay on all income generated from the permanent establishment in Mexico.

 

III.        Those with residence in a foreign country, must report and pay on the income produced by property located in the national territory, when there is no permanent establishment in the country or, even if there is, but not covered by the situations outlined in I and II above..

 

If you own a property in Mexico and rent it often or only occasionally,  ENJOY your rental income and SLEEP EASILY KNOWING YOU HAVE COMPLIED WITH TAX LAWS!

 

The Settlement Company® with many years of experience in the transfer of titles and resolution of problems related to title, is now able to assist you in receiving your funds in an escrow account, complying with your fiscal obligations in Mexico, and providing you with the overage and the documents you require in your country of residence to avoid double taxation!

 

Additionally………..as part of our service,  if requested, we pay your annual property taxes  and, if your property is in trust (fideicomiso) bank trustee fees!  We also can pay other property related expenses, at your request!   We are able to provide you with a limited or a complete accounting service, based upon your requirements.!

 

For further information  on this program, please contact The Settlement Company® at quirino.parra@settlement-co.com or info@settlement-co.com

 

 

 

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