Most large Mexican business taxpayers must have their annual tax returns certified by a public accountant. Other taxpayers may do so on a voluntary basis as a shield against a government tax audit. For calendar year taxpayers required to have an accountant's report (dictamen fiscal), the tax return is due on March 31 and the dictamen fiscal on July 31.
Transfer pricing statement
Starting with the 1997 tax year, the dictamen fiscal must include a statement that applicable transfer pricing documentation requirements have been satisfied. Although Mexican law does not make relief from transfer pricing penalties conditional on having the documents in existence before a tax examination, a statement in the dictamen fiscal that there is insufficient documentation would probably provoke a prompt examination.
Owing to the need for a transfer pricing statement, as well as changes in the required format of the dictamen fiscal, preparers had requested relief from the Mexican Tax Administration Service (SAT) with respect to the due date for 1997 reports. Having first extended the due date to August 31, the SAT authorized a further extension until September 30 for obligatory dictamenes, August 31 for voluntary dictamenes, and October 15 for holding companies that consolidate tax results.
Special extension for transfer pricing documentation
In addition, the SAT has authorized preparers to submit the mandatory statement on transfer pricing documentation as late as six months after the rest of the dictamen is filed.
To take advantage of this six-month extension, the taxpayer must file a written notification with the SAT not later than the filing date of the dictamen. The notification must include specified information about related parties and controlled cross-border transactions for 1997.
William Chip and Luis Coronado
