Nov 27, 2011, 7:41 PM
Wrong again; he's not earning money from a Mexican source and he's not receiving income in Mexico.
There seem to be 2 competing world-views here, and the OP will have to choose for himself.
One side advocates:
1. Lie to your employer about where you are located, and use blocking and masking programs to hide your location from your employer.
2. Lie on your Formato Basico that you fill out when you enter Mexico, and deny your intention to work while in Mexico.
3. Even though the OP clearly says that they "have moved to Mexico" and are "working in Mexico", they are advised by some to falsely declare that Mexico is not their primary place of activity.
4. Foreigners who reside here and work here, and legally owe taxes here, are then advised by this group that they should not declare income nor pay legally owed taxes.
5. Ignore the laws and rules.
6. Do what is necessary to do what you want.
The other side advocates:
1. Be forthright and truthful with your employer.
2. Tell the truth to the Mex. Gob. and fill out INM forms truthfully.
3. Pay taxes as required by laws.
4. Follow laws and rules, even when those laws and rules are inconvenient or expensive.
5. If this is your primary place of activity (because you have moved here), then you are supposed to report worldwide income, and pay your share of Mexican taxes - because you use Mexican services.
These differing viewpoints have been around as long as people have joined together into groups with rules.
There is also a 3'rd group who selectively follow rules, based on some combination of convenience, the likelihood of getting caught, and the severity of penalties of getting caught. e.g. In countries like Sweden where one loses their license for driving under the influence, compliance with this law is very high. In the USA where people can get 5 - 7 DUI's before facing serious penalties, driving after a few drinks is generally considered no big deal. The people who drive after having a few drinks do not consider themselves as criminals, even though they break the law.
The same issues pop-up with expats and duties. Some advise others on how to skirt the systems, and how to beat the systems, effectively advising others to not pay legal duties. Along with those who pay only when they think it is fair or convenient, there are always people who want to get or take things, like public services, without paying for them, unless forced.
Alternately, there is a group who advocates following the laws and rules, folks who pay what's legally owed, so that the larger organizations can continue to provide roads, water, sewer, police protection, etc.
Neither side can ultimately convince the other 2 groups that they should change.
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(This post was edited by YucaLandia on Nov 27, 2011, 7:58 PM)