Every country has unique invoice requirements, which dictate how invoices are created and used. These requirements are put in place to protect the buyer, the seller, and the interests of the government. Sellers generally issue invoices to buyers for different reasons. Invoices come either in physical form or electronic form.
Electronic Invoice Requirement
In 2011, Mexico became one of the few countries that require all invoices that are issued and used in the country to be in an electronic format. This requirement has made the generation and use of invoices smooth and easy.
An electronic invoice in Mexico is known as “comprobantes fiscales digitales” (CFD). It is a legal document, which is acceptable as an electronic tax voucher that all business and cooperation must present for approval to the Mexican Tax Authority (Servicio de Administración Tributaria or SAT).
Before electronic invoices go to SAT, these first pass through a government recommended (Proveedor Autorizado de Certificación or PAC) website service for verification. The PAC is responsible for the validation of invoices, the assignment of reference numbers, and the insertion of digital signatures before the SAT’s approval.
All invoices must possess specific basic requirements, as stated below.
- A company must acquire approval from the SAT for each type of CFD it plans to use.
- Acquire a reference number from PAC, which consists of a series of authentication codes.
- The CFD must be in an XML or a PDF format. Either of the formats must be structured to suit the requirements of SAT.
- A company must provide a periodic report of CFDs and physical invoices produced to the SAT.
- All invoices must be in Spanish, the local Mexican language.
Required Electronic Invoice Information
All forms of invoices to be valid in Mexico, they must have the following information.
- Names and addresses of all the parties involved,
- Tax details of all the parties,
- Date of transaction, invoice reference number, and location,
- Invoice authentication code,
- Details about the number and cost of each item or service involved, which includes all the total amount involved,
- Electronic signature or electronic stamp of the seller,
- The identification number of real estate is involved.
- The customer’s details for import or export,
- The amount of VAT that applies in the transaction.
Printing of Electronic Invoices
If there is a reason to print an XML electronic invoice into a physical invoice, it must adhere to specific Mexican government rules and regulations. Although the seller is not required by law to provide a physical invoice, when a buyer requires it, the seller usually grants the request. The successful conversion of an XML invoice into a physical invoice involves changing it into a PDF document which can easily be printed by either of the parties involved.
Other Electronic Invoicing Requirement
Bonuses, discounts or returns must also come in electronic invoice format for transmission via email or any valid electronic means. However, the regulation does not allow for negative records on an electronic invoice.
The Mexican invoice requirements is a systematic framework for the generation of an electronic invoice, which has significantly eased all business transactions in the country. These requirements have made the country amongst the leaders in electronic invoicing.