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Hi there. My aunt co-owns a very nice condo in Mexico. They have never rented it out above and beyond the minimum necessary to cover condo association dues each year … which equates to be 6 weeks of renting and their minimum price.
They are trying to sell the condo and have no interest in being property managers or gaining an income from the home. They (my aunt and her friends, a couple) are getting older and don’t really need or want the income. We are thinking of purchasing the friends share but my aunt would like me to try renting it/managing it prior to that so I can get a feel for whether or not I really want to take it on. They want me to have the potential income from renting that is above and beyond the condo fees for the year. I am not sure if I can do that. They (my aunt and the co-owners) don’t want to mess with the taxes or worry about any of that, but I am thinking they don’t have a choice due to ownership.
I did set up a VRBO listing but have yet to publish it and am looking at listing on airbnb in addition to or in lieu of. My question is this: Since I am not the owner and I am not a licensed property manager, can I, in fact, manage a property and earn income from it? I have done some searching and research but am not having much luck so any help or pointing me in the right direction would be most appreciated.
The condo is in Mexico? Unless Mexican law requires a “registered property manager” (I’ve never heard of such a thing) there should be no problem. Will you be living on-site? In any case I would get a formal letter from the actual owners, requesting you to manage the property for them.
Hi, I am new, and don’t know how to start a post. Can anyone help me? I want to know if there are any other owners in Puerto Aventuras, Mexico. It is 20 min. south of Playa del Carmen. We are just buying it, and going to rent it out, and wanted any advice. thanks
@Dori_Warner You need to be aware of the tax implications of having a rental property in Mexico. You need to pay taxes to Mexico on the rental. This includes 16% VAT tax (called IVA in Mexico), Occupancy tax (charged at various rates or not charged at all depending on the state the listing is in) and income tax. The IVA and occupancy tax is charged to the guest, the income tax is charged to the host. All these amounts are withheld by Airbnb and paid to the Mexican tax department.
If you are a Mexican citizen or permanent resident, you need to get an RFC (tax number) from the Mexican tax dept. (SAT). You cannot get a Mexican tax number otherwise, and if you don’t have a tax number, Airbnb will withhold 20% income tax from your payouts. If you do have a tax number, you will only be charged 4% income tax.
In any case, you will need a Mexican accountant, and if you are a US citizen, you will also need to declare your earnings and pay taxes to the IRS. There is a tax treaty between the US and Mexico, which prevents double taxation, which means the the income taxes you have paid in Mexico will be deducted from the taxes you owe in the US.