Reasons to apply the Mexican CFDI Foreign Trade Complement

por Irais Arreola Irais Arreola | Dec 16, 2021 7:56:37 AM

CFDI - Mexican electronic billing

What is CFDI?

CFDI, stands for Comprobante Fiscal Digital por Internet, and it is the electronic billing established by the Mexican federal tax code. It has been mandatory for companies that do business in Mexico since 2011. It's the mechanism the Mexican government uses to make sure it is receiving accurate payments.

What kind of control or benefit do Mexican authorities look for by implementing a Foreign Trade Complement?

Although electronic billing was already issued in Mexico since 2011, the information in the documents prepared for foreign trade (COVE, Proforma, Pedimento) was not linked to internal taxes therefore, it was decided to implement a Foreign Trade Complement to the CFDI to achieve this informational exchange between tax authorities, by means of the internet.

Who Makes Use of This Process?

This Foreign Trade Complement must be used by individuals or corporations that export goods with the export code "A1", which is used for definitive (permanent) exportations. It does not apply to exportation made via postal services, since these are considered minor exports.

      Objectives and Scope

  • That the tax authorities of the USA and Canada can make use of an electronic invoice issued by the Mexican exporters to verify the taxpayer's tax identity.
  • To use in the electronic invoice the tax identifier "TAX ID" for both the exporter and the importer of goods in the USA and Canada.
  • That the tax or customs authority, recipient of the merchandise exported from Mexico, can verify the authenticity and legality of the operation

Evolution of Tax Billing in Mexico

From 2002 to 2005, the invoicing is issued by an authorized printing company. The transition to electronic invoicing takes place from 2005 to 2013. In 2014, it is implemented including the XML technological standard, as well as the use of electronic signatures.

Information Included in the Foreign Trade Complement

The data that the digital tax receipt (CFDI) must include in the Foreign Trade complement are: Version, Type of transaction, Passcode (A1), Certificate of origin, Incoterm, Subdivision, Exchange rate USD, Total USD, Issuer , Recipient (Tax Identifier), Recipient (Tax Identifier and address), Merchandise (Merchandise, tariff item, identification number, value in dollars, unit of measure).

Operating Flow, What Changed?

The most important changes in the operating flow are:

  1. The integration of customs and complementary data for billing
  2. The establishment of an interface to generate the CFDI for the buyer according to the guidelines (TAX ID, address, incoterm and tariff fraction by the exporter. From SAT: verification of the TAX ID. From PAC: validation of the TAX ID.)

IF you would like to know how Casa Sauza implemented this legal requirement, I suggest you read our next blog: "Foreign Trade Complement the Tequila Industry".

Come and visit Casa Sauza and see for yourself how the modernization of our production processes delivers the purest tequila that you will find in the market.

Click here for more information on Casa Sauza Guided Tours

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