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Short stays through digital platforms: 4 percent income tax and 50 percent VAT withholding for resident hosts, 20 and 100 percent without an RFC, and the final payment option

Last verified: 2026-10-26 · Status: Changing

Lodging is not exempt housing rent: short stays and furnished units bear 16 percent VAT, and platforms withhold 50 percent of that VAT from resident individual hosts, or 100 percent if the host gives no RFC. Platforms also withhold income tax of 4 percent of lodging income from resident individual hosts, or 20 percent without an RFC; hosts with platform income up to MXN 300,000 a year may elect to treat the withholding as final. The 2026 Revenue Law raised the platform rate for sales of goods and other services to 2.5 percent, but the lodging rate stays at 4 percent; non resident owners remain under the 25 percent gross rent rule.

USD conversions use MXN 18.6638 per US dollar, the US Federal Reserve H.10 noon buying rate in New York for 23 October 2026 (FRED series DEXMXUS), the latest observation available when this page was verified. Legal conversions in Mexico use the Banxico FIX, which differs slightly. Conversions are for orientation only.

Key facts

Income tax withholding by platforms on lodging income of resident individuals	4 %LISR art. 113 A, section II, as of 2026-10-26 · in force
Platform income tax withholding on sales of goods and other services, 2026	2.5 %LIF 2026 art. 25, section VI, as of 2026-10-26 · in force
Platform income tax withholding when the individual gives no RFC	20 %LISR art. 113 C, as of 2026-10-26 · in force
Share of VAT withheld by platforms from resident individual sellers and hosts	50 %LIVA art. 18 J, section II a), as of 2026-10-26 · in force
Prior year platform income cap for the final withholding option	300000 MXNLISR art. 113 B, as of 2026-10-26 · in force

The rule

1. VAT on lodging. The housing exemption for rent does not apply to property, or parts of it, provided furnished or used as hotels or guest houses. A home is furnished when supplied with furniture beyond fixtures, kitchen and bathroom equipment and the other items listed in the regulation; for furnished housing VAT applies to the whole rent even if separate contracts cover furniture and property.
Cost to do it: VAT at 16 percent on the nightly price.
Example: A host charges MXN 50,000 of stays in a month through a platform; VAT is MXN 8,000. / Stays about USD 2,679; VAT about USD 429.Ley del Impuesto al Valor Agregado, DOF 29 December 1978, arts. 1o. and 20, section II; Reglamento de la LIVA, DOF 4 December 2006, art. 45, LIVA art. 20, section II; Reglamento art. 45, 1978-12-29 official text · verified 2026-10-26

2. VAT withholding by platforms. Foreign platforms without a Mexican establishment that collect the price and VAT for transactions of their users must withhold 50 percent of the VAT charged by resident individuals who sell goods, render services or grant temporary use of goods; if the individual does not give its RFC, the platform withholds 100 percent. The platform replaces the host in paying the withheld amount.
Cost to do it: Tax only.
Example: On MXN 8,000 of VAT the platform withholds MXN 4,000; the host pays the remaining MXN 4,000 net of creditable VAT. / About USD 214 each.Ley del Impuesto al Valor Agregado art. 18 J, section II, item a), added DOF 9 December 2019, LIVA art. 18 J, section II a), 2019-12-09 official text · verified 2026-10-26

3. Income tax withholding for resident individual hosts. Resident individuals with business activity who provide services through platforms bear income tax withholding by the platform on the gross amounts received, excluding VAT: 4 percent for lodging services, 2.1 percent for passenger transport and delivery, and, under the 2026 Revenue Law, 2.5 percent instead of 1 percent for sales of goods and other services. If the host does not provide its RFC, the platform withholds 20 percent. The withholding is a provisional payment.
Cost to do it: Tax only.
Example: On MXN 50,000 of lodging income, income tax withholding is MXN 2,000, or MXN 10,000 if the host gave no RFC. / About USD 107, or USD 536 without an RFC.Ley del Impuesto sobre la Renta arts. 113 A (rates reformed DOF 8 December 2020) and 113 C; Ley de Ingresos de la Federación para 2026, DOF 7 November 2025, art. 25, section VI, LISR arts. 113 A and 113 C; LIF 2026 art. 25, VI, 2025-11-07 official text · verified 2026-10-26 · changed: LIF 2026 art. 25, section VI replaced the 1 percent rate for sales of goods and services (LISR art. 113 A, section III) with 2.5 percent for 2026; the 4 percent lodging rate (section II) did not change.

4. Final payment option. Individuals whose only income is from platform activities (and who may also have wages or interest) and whose income did not exceed MXN 300,000 in the prior year may elect to treat the withholdings as final payments, filing a notice within 30 days after the first income. They then cannot deduct expenses for that income, must keep the platform invoices and must stay in the option for five years unless they cease to qualify. Hosts with up to MXN 300,000 who also receive part of their payments directly from guests may apply the same rates to all income as a final payment.
Cost to do it: Tax only.Ley del Impuesto sobre la Renta arts. 113 A, fourth paragraph, and 113 B, added DOF 9 December 2019, LISR arts. 113 A and 113 B, 2019-12-09 official text · verified 2026-10-26

5. Non resident owners. The platform regime above applies to resident individuals. Non residents who grant use of Mexican real estate remain taxed at 25 percent of gross income without deductions, withheld by the payer, or self assessed within 15 days if the payer is a non resident; trusts make the trustee bank the withholding agent.
Cost to do it: Tax only.Ley del Impuesto sobre la Renta art. 158, LISR art. 158, 2013-12-11 official text · verified 2026-10-26

Worked example

A resident individual earns MXN 50,000 (about USD 2,679) in a month from short stays booked through a foreign platform, plus MXN 8,000 VAT. The platform withholds income tax of MXN 2,000 (4 percent) and VAT of MXN 4,000 (50 percent). If annual platform income stays under MXN 300,000 and the host elected the final option, the income tax withholding is the final tax (LISR arts. 113 A and 113 B; LIVA art. 18 J).

Step by step

1. Register in the RFC and give it to the platform to avoid 20 percent income tax and 100 percent VAT withholding.
2. Decide within 30 days of the first income whether to elect final withholding (if eligible).
3. Keep the platform's withholding invoices monthly.
4. If not in the final option, file monthly returns crediting the withholdings.
5. Check state lodging taxes and condominium rules, which are set locally.

Common traps

Not giving the RFC: income tax withholding jumps to 20 percent and VAT withholding to 100 percent (LISR art. 113 C; LIVA art. 18 J).
Assuming the 2026 2.5 percent rate applies to lodging: LIF 2026 changed only the goods and other services rate (LIF 2026 art. 25, VI).
Treating short stays as exempt housing rent: furnished housing and guest houses bear VAT (LIVA art. 20).
Non residents using the resident regime: the 25 percent gross rule of LISR art. 158 applies to them.

Sources

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