Selling a used car might seem like a routine activity for someone needing cash or simply upgrading to a newer model; however, if you have carried out this transaction—or plan to do so—you must notify the SAT (Tax Administration Service). Failure to do so could result in significant financial penalties, similar to the consequences of not paying traffic fines.
The SAT deemed this reporting requirement essential—specifically, the need for citizens to account for their income and expenditures (how they earn and spend money)—to prevent organized crime-related offenses such as money laundering.
In line with this policy, both individual and corporate taxpayers are required to report all specific expenses and income in their annual tax return, allowing the government to track the origin and destination of funds.
Therefore, if you have bought or sold a used car, you must report it in the annual tax return submitted to the tax authority under the Secretariat of Finance and Public Credit.
As expected, failure to comply with SAT requirements empowers the agency to impose financial penalties. These range from 1,810 to 44,970 pesos for missing the established deadline; from 17,190 to 34,350 pesos for failing to submit a compensation notice; and from 18,360 to 36,740 pesos for failing to file mandatory electronic tax returns.
It is important to note that tax payment is not required in every instance. According to the Income Tax Law, income tax (ISR) is not payable on proceeds from the sale of movable assets (such as cars) if the difference between the sale price and the acquisition cost does not exceed three annualized Units of Measurement and Update (UMA).
Source: motorpasion
