Mexico, as of now, has no such tax rule on cryptocurrency. The FinTech Law clarifies the nature of crypto by saying that it is not illegal but also not legal tender or foreign currency and does not lay out any system to tax these transactions. Thus, crypto tax in Mexico can be taxed as movable property and not as cash or currency.
Still, there are various ways in which crypto could still be treated and taxed accordingly. There is a crucial need for proper regulations in Mexico for crypto currency as the citizens are actively investing in it and looking to conduct transactions via crypto. As of 2021, 3.1 million people, that is 2.5% of its whole population, own cryptocurrency in Mexico.
Do you have to pay crypto tax in Mexico?
Yes, you have to pay crypto tax in Mexico. Crypto is taxed on the gains made on sale of crypto. However, the nature of crypto makes it difficult to place it in an appropriate category, such as income tax or VAT, which leads to confusion and inefficiencies.
When do you have to pay tax on crypto in Mexico?
When being treated as movable property, crypto is taxable as ordinary income under MITL. Exchange of crypto is also taxable as it comes under sale of property and is taxed accordingly.
What crypto transactions are taxable in Mexico?
Sale of crypto and Swapping of crypto is taxable in Mexico.
What are the Crypto Tax Rates in Mexico?
Crypto tax in Mexico is levied on the net profit received in the sale of the crypto or if the held crypto was exchanged for another coin at varying rates from 1.92% to 35%. Capital Gains and income is taxed in the same manner in Mexico and there is no distinction between the two. Although, capital gains that are less than 90,000 Mexican pesos, which might cover a significant number of crypto transactions.
Mexico Income Tax Brackets (2023)
| NET PROFIT (MEX$) | TAX RATE (%) |
| 0.1 – 8952.49 | 1.92 |
| 8,952.50 – 75,984.55 | 6.40 |
| 75,984.56 – 133,536.07 | 10.88 |
| 133,536.08 – 155,229.80 | 16 |
| 155,229.81 – 185,852.57 | 17.92 |
| 185,852.58 – 374,837.88 | 21.96 |
| 374,837.89 – 590,795.99 | 23.52 |
| 590,796.00 – 1,127,926.84 | 30 |
| 1,127,926.85 – 1,503,902.46 | 32 |
| 1,503,902.47 – 4,511,707.37 | 34 |
| 4,511,707.38 AND ABOVE | 35 |
Mexico Capital Gain Tax Rates (2023)
| NET PROFIT (MEX$) | TAX RATE (%) |
| 0.1 – 8952.49 | 1.92 |
| 8,952.50 – 75,984.55 | 6.40 |
| 75,984.56 – 133,536.07 | 10.88 |
| 133,536.08 – 155,229.80 | 16 |
| 155,229.81 – 185,852.57 | 17.92 |
| 185,852.58 – 374,837.88 | 21.96 |
| 374,837.89 – 590,795.99 | 23.52 |
| 590,796.00 – 1,127,926.84 | 30 |
| 1,127,926.85 – 1,503,902.46 | 32 |
| 1,503,902.47 – 4,511,707.37 | 34 |
| 4,511,707.38 AND ABOVE | 35 |
How is Tax Calculated on Cryptocurrency in Mexico?
Crypto is taxed in Mexico on the net profit made when the currency is sold and if it is exchanged for another coin. While the selling price of crypto is the price you sold it at, determining the cost price is a bit difficult if you purchased the coins you sold on different occasions and at different prices. In order to determine your cost price, two methods: FIFO (First In First Out) and ACB (Average Costs Basis) are used.
According to FIFO Method, you sell your oldest acquired coin first and cost is calculated according to the respective prices at which the coin was bought. Whereas, in ACB, time of buying doesnt matter and average cost is taken into account.
Let’s take an example,
Say you bought 2 BTC for MEX$ 20,000 in 2020 and 4 BTC for MEX$ 60,000 in 2021. Then you sold 4 BTC in 2022 for MEX$ 1,00,000:
- FIFO METHOD
You sell 2 BTC from 2020 and 2 BTC from 2021. So cost price is:
= 20,000 + (2/4)*60,000
= MEX$ 50,000
Profit = 1,00,000 – 50,000
= 50,000
Here, taxes are levied on MEX$ 50,000 .
- ACB METHOD:
All coins are of the same denomination. Therefore, cost price for one coin:
= (20,000 + 60,000)/6
= MEX$ 13,333
So, cost price of 4 coins:
= MEX$ 53,333
Profit = 1,00,000 – 53,333
= 46,666
Here, taxes are levied on MEX$ 46,666.
Is there any Crypto Tax Free in Mexico?
Capital gains less than MEX$ 90,000 are exempt from taxes in Mexico. Thus, crypto transactions less than MEX$ 90,000 might not be taxable.
Crypto Tax in Mexico – FAQs
Do you have to pay tax when you buy crypto in Mexico?
No, buying crypto is not taxable in Mexico.
Do you have to pay tax when you sell crypto in Mexico?
Yes, you have to pay tax when you sell crypto in Mexico at varying rates from 1.92% to 35% depending upon the net gains made from the transaction.
Do you have to pay tax when transferring crypto in Mexico?
No, transfer of crypto between wallets is not taxable. Although, a transfer fee might be charged by the provider.
Do you have to pay tax when spending crypto in Mexico?
When spending in crypto, a transaction is occurring and naturally it should be taxed according to VAT. In Mexico, crypto is not exempt from VAT, Therefore, spending in crypto might be taxable in Mexico, although lack of clear cut rules makes it difficult to decipher.
Is swapping crypto taxable?
Yes, swapping crypto is taxable in Mexico as it is taken to be sale of property.
How much tax on crypto gains in Mexico?
NET PROFIT (MEX$) TAX RATE (%) 0.1 – 8952.49 1.92 8,952.50 – 75,984.55 6.40 75,984.56 – 133,536.07 10.88 133,536.08 – 155,229.80 16 155,229.81 – 185,852.57 17.92 185,852.58 – 374,837.88 21.96 374,837.89 – 590,795.99 23.52 590,796.00 – 1,127,926.84 30 1,127,926.85 – 1,503,902.46 32 1,503,902.47 – 4,511,707.37 34 4,511,707.38 AND ABOVE 35
How do I avoid capital gains tax on crypto in Mexico?
Capital gains tax in crypto can be avoided by keeping the gains less than MEX$ 90,000 as these gains are exempt from taxation under MITL.
Market Research Intern, Octaloop
Maitreyee takes a keen interest in financial technologies and their potential to transform lives at the grassroots. Put together with her penchant for Economic Research, she brings tonnes of academic and actionable insight into our products. Maitreyee is contributing at Binamite as a Market Research Intern, and when she's not doing that, you can find her exploring the city or buried in a book.