The notary formalizes the sale purchase agreement
The notary public will request from the seller:
• Property title (escritura), which the seller already has
• Receipts evidencing the payment for real estate taxes for a period of five years (boletas del impuesto predial)
• Receipts evidencing the payment of water fees for a period of five years (boletas del servicio de agua)
• Public deed(s) containing the incorporation and by-laws of the seller company (escritura constitutiva), together with copy of any public deed(s) containing amendments to the by-laws of the seller company
• Public deed(s) containing the powers of attorney granted in favor of the seller’s representatives (for acts of domain and acts of administration in terms of the second and third paragraph of article 2554 of the Civil Code of the Federal District)
• Copy of the official identification of the seller's and buyer's representatives
The notary will procure on behalf of the parties:
• The zoning certificate (obtained in Procedure 2)
• The valuation (obtained in Procedure 3)
• Certificate of good standing with the water company (obtained in Procedure 1)
• Certificate of good standing in the property tax (obtained in procedure 4)
The buyer is subject to pay the acquisition tax ("Impuesto sobre Adquisiciones o Transmisión de Dominio"). In this respect, on the date of execution of the real estate purchase agreement before the notary public, said notary public will retain the above mentioned taxes and pay them before Treasury Department.
The scale of notary tariffs is with respect to the Notary Publics of the Federal District only. Other Mexican states have varying scales.
The seller will also have to pay the income tax and the value added tax as follows:
The applicable Income Tax for transferors resident in Mexico is 28% on the gain (the excess of the sale price over the adjusted tax basis). The tax basis of real estates is in general terms the original cost of acquisition as updated for inflation.
The value added tax (16%) is applicable only with respect to the constructions that conform to the property and therefore an allocation of the price to the land and constructions should be made in the sales agreement based on an appraisal. The value added tax will be shifted to the buyer.
The notary public shall calculate its fees as set forth in Article 15 of the Notary Fees of the Federal District (Arancel de Notarios), taking into account the highest of (i) the purchase price, (ii) the cadastral value, and (iii) the value resulting from the commercial valuation by the fiscal authorities or authorized appraiser.
Property Acquisition Tax, according to the following scale, from Art 113 of the Fiscal Code of the Federal District:
||Rate over excess
|Notary Fees as officially published on March 12, 2013, according to the following, which are established on art. 15. of the Notary Fees of the Federal District (Arancel de Notarios).
|I. In transactions up to MXN $132,791.00, a fixed quota of MXN $4,829.00
|II. In transactions from $132,791.01, the fixed quote established above plus the amount which results applying the previous table to identify the amount under following table:
|More than MXN
||up to the excess of
|the lower value