STARTING A NEW
BUSINESS IN MÉXICO

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Puerto Vallarta, Jal., December,  2001

 

Specific Question: Requirements needed to set up and operate a Small Business in the city of Puerto Vallarta.

Options:
Owned by an Individual.
Owned by a Corporation.
 

Owned by an individual: You will need to get the following:

Immigration Permit
Hacienda Id. (Tax Service).
City license (Municipio).
 

Owned by a Corporation: You will need to get the following:

Act of Incorporation
Immigration Permit.

Hacienda Id. (Tax Service).
City license (Municipio).

These are the basic legal requirements needed to open and operate a business. You need to take into consideration other inherent subjects such as: telephone and other services such as water, electricity, computer equipment, etc.,

You need to be careful when hiring people to work for you or the corporation and always sign a work contract. We can help you draw: lease contracts, work contracts, advertisement services contracts, etc.

There are additional requirements to protect your business, such as Trade Marks registration before IMPI (Mexican Institute for the Protection of Industry) or Intellectual work protection, etc., Specific additional information is required to provide you with proper advice. Which can be ascertained at a later date.

If you apply as an individual, you will need to sign up for a Tax Id. before you can do anything else.

The documents needed to get a Hacienda ID (Registro Federal de Contribuyentes) are:

1.- Notarized copy of passport.
2.- Proof of Address. (Water Department, Electricity or telephone company  receipt).

Signing up for Hacienda can be done in one day. 

Once you have signed up with HACIENDA, you will need to apply for the migratory permit (FM3) and the City License.

Documents needed to apply for immigration permit:
1.- Letter requesting permit to work in México.
2.- Certificate or Diploma for profession or trade.
3.- Tax Id.
4.- Original FMT (Tourist Card).
5.- Copy of Passport.
6.- 8 Photos. Black and White. 4 front, 4 side, non instant, non glossy.
7.- Proof of Address. ( Water Department, Electricity or telephone company  receipt).
8.- Pay the Government Fees.

It will take approximately 6 weeks for immigration to process your application for an FM3.

1.- Documents needed to get a city license:
a).- Copy of Tax ID.
b).- Copy of Identification of Legal Representative (Passport, FM3).
c).- Copy of the lease agreement.
d).- Copy of Property Tax receipt.
e).- Photograph, from outside, of the space or business.

If you decide to set up and do everything through a corporation, you NEED TO KNOW the following:

A corporation is formed with at least 2 stockholders.
The minimum capital is $50,000.00 pesos.
The cost to set up a corporation is approximately $5,000.00 pesos, plus the Secretary of Foreign Affairs permit which is approximately $3,000.00 pesos.
It takes up to 20 days to get the S. of F.A. permit and another 10-15 to complete the corporation set up.

Once the corporation is set up, the Notary will give you a notarized copy which you will use to GET THE TAX ID. (Registro Federal de Contribuyentes). The Notary will request the Legal representative for the corporation to get one tax id for the company and one for each stockholder.

Stockholders will declare taxes when the company pays them a salary or when they have income.

If there are no Mexican Stockholders in the corporation, you will need to issue a temporary Power Of Attorney, to whomever you want, to sign up the company before Hacienda, request your FM3 Permit to be the Manager for the corporation and request the city license.

Once you have the authorization from Immigration you can do any changes allowed to the Legal Representatives.

To get the Company Tax Id, you will need:
1.- Notarized copy of the Act of Incorporation.
2.- Copy of  ID of Legal Representative
3.- Proof of Address. (Water Department, Electricity or telephone company  receipt).

Once the company is properly signed up with HACIENDA, you or the legal representative for the corporation can request for the permit authorizing you (FM3) and the City License.

We always recommend having a Certified Public Accountant assist you in all matters related to the corporation accounting. In México, income is reported on a regular basis, (every three months). If there is any taxable income, the taxes are paid when the report is done.

Accountant fees for CORPORATION:
$750-2,000.00 pesos a Month.
(Depends on the amount of work) Accountant fees  (INDIVIDUAL)
$300-1000.00 pesos a Month.
(Depends on the amount of work)

Documents needed to apply for immigration permit: (As Manager/Legal Representative of corporation)

1.- Letter from the corporation requesting permit.
2.- Letter from you requesting permit to be the Corporation Manager/Legal Representative.
3.- Copy of Corporation Tax Id.
4.- Copy of your Tax Id.
5.- Original FMT (Tourist Card).
6.- Copy of Passport.
7.- 8 Photos. Black and white. 4 front, 4 side. Non instant, non glossy.
8.- Proof of Address for corporation. ( Water Department, Electricity or telephone company  receipt).

The fees and processes are the same as the ones described above.

1.- Documents needed to get a city license:

a).- Copy of Tax ID.
b).- Copy of Identification of Legal Representative (Passport, FM3).
c).- Copy of the Incorporation Act.
c).- Copy of lease agreement.
d).- Copy of Property Tax receipt.
e).- Photograph, from the street, of the space or business.

It takes 15 days to receive your license. If you submitted all requirements, the city will give you a temporary 15 days permit to operate the business.

ALEJANDRO NIÑO MERINO