How are different expense categories treated in Mexico for reimbursement?

Expenses Invoicing Requirements

In Mexico, all taxpayers (vendor) are obligated to issue e- invoice in the form of an “XML” file and a printed representation in the form of a “PDF” file to their clients (in this case, the employee making the purchase). The eInvoice should include the tax ID of the recipient to correctly be considered as a deductible item for income tax purposes. Provide the following information to the vendor to be included on the e-invoice:

Company: Servicios Internacionales de Velocity Global S

de RL de CV

Address: Av. Insurgentes Sur 682 Int. 804, Col Del Valle

State: Ciudad de México

Delegation: Benito Juárez

City: Ciudad de México

Country: México

Zip Code: 03100

RFC: SIV180611NG7

XML email: ap-mx@velocityglobal.com

Passports/Work Permits/Visa

Employees are responsible for ensuring that they have a valid and current passport/work permit/visa.

Transportation Expenses

Be duly supported with the relevant electronic invoice (hereinafter “e-Invoice”).

Per diems

Per Diems Are Not Allowed

No receipt = non-compliant, payment through payroll with a gross-up

Air Travel/Bus and Train

Be duly supported with the relevant electronic invoice (hereinafter “e-Invoice”).

Taxi, Cabify, Uber, and related apps

Be duly supported with the relevant electronic invoice (hereinafter “e-Invoice”).

Car Rental

Be duly supported with the relevant electronic invoice (hereinafter “e-Invoice”).

Car Parking Fees

Be duly supported with the relevant electronic invoice (hereinafter “e-Invoice”).

Tolls

Be duly supported with the relevant electronic invoice (hereinafter “e-Invoice”).

Other Business Travel-Related Expenditure

Be duly supported with the relevant electronic invoice (hereinafter “e-Invoice”).

Travel Insurance

Be duly supported with the relevant electronic invoice (hereinafter “e-Invoice”).

Mileage and Fuel

Non-compliant as no receipt is available. The rate should be defined by the Supervisor and the Employee and no more than 25,000 kilometers in a tax year.

Accommodation

Be duly supported with the relevant electronic invoice (hereinafter “e-Invoice”).

Meals (travel/events/during work)

Be duly supported with the relevant electronic invoice (hereinafter “e-Invoice”).

Client Entertainment

Be duly supported with the relevant electronic invoice (hereinafter “e-Invoice”).

Staff Entertainment

Be duly supported with the relevant electronic invoice (hereinafter “e-Invoice”).

Mobile Phone bills

Non-compliant. Phone and internet can be paid through payroll, as they’re considered work tools for which no taxes are applicable. There is no limit to this payment, but the amount for these two concepts must be specified in the employment contract.

Broadband (Internet)

Non-compliant. Phone and internet can be paid through payroll, as they’re considered work tools for which no taxes are applicable. There is no limit to this payment, but the amount for these two concepts must be specified in the employment contract.

Computer Equipment, Software, Office Space, Furniture, Phones, Other Assets

Internal fixed assets policy.

Furniture

Internal fixed assets policy.

Stationery

Be duly supported with the relevant electronic invoice (hereinafter “e-Invoice”).

Gifts

Be duly supported with the relevant electronic invoice (hereinafter “e-Invoice”).

Coworking and Office Rentals

Be duly supported with the relevant electronic invoice (hereinafter “e-Invoice”).

Bank Charges

Bank or credit card charges incurred because of the employee's delays claiming expenses will not be reimbursed.

Foreign Currencies

Each employee is responsible for obtaining the necessary foreign currency on international travel, commission expenses for currencies purchased on foreign travel will be reimbursed with the respective supporting documentation.

Annual subscriptions

Be duly supported with the relevant electronic invoice (hereinafter “e-Invoice”).

Training Expenses

Upon approval of the supervisor, a membership will be reimbursed per employee, per association, when it is specifically related to the functions of their job, with respective supporting documentation.

Medical Claims/Health Check Up and related items/Medical Insurance

N/A

Exception and Other tpyes of expenses

N/A

Event expenses (trade shows/conferences)

No issues as long as event directly related to business. Please provide relevant receipts

Meals (travel/events/during work)

Meals on business trips are not taxable.

Di minimus expenses (Tips, no receipt)

N/A

Payroll Reporting

N/A

Additional Reporting

N/A

Review process

N/A