Setting Up a Business in Mexico: Guidelines for Establishing a Company.

Setting Up a Business in Mexico: Guidelines for Establishing a Company

Starting your own business can be a daunting task no matter where you live in the world. If you’re considering setting up a business in Mexico, this guide will provide you with the necessary information you need to know to start your company and succeed.

Choosing a Business Structure

Before you can establish your new business, it’s important to consider the legal structure of your company. There are several options for businesses in Mexico, including:

Sole Proprietorship

A sole proprietorship is the simplest form of business structure in which the owner is the business. In this arrangement, the owner/proprietor is responsible for all aspects of the business, including finances, legal compliance, and taxes.

Limited Liability Company

A limited liability company (LLC) is a popular option for small businesses in Mexico. This business structure limits the personal liability of the owners, meaning that their personal assets are protected if the business is sued or experiences financial difficulties. In an LLC, owners are called “members”.


A corporation is a separate legal entity from its owners, meaning that the corporation can sue or be sued, make contracts, and hold assets in its own name. Shareholders (owners) of the business are not responsible for the corporation’s debts, but they do pay taxes on their earnings.

Registering Your Business

Once you’ve decided on the legal structure of your business, you’ll need to register it with the Mexican government. This process involves several steps, including:

Choosing a Business Name

Your business name must be unique and easily identifiable. You can check the availability of your desired name with the Mexican Patent and Trademark Office.

Obtaining a Tax ID Number

All legal entities must obtain a tax ID number (known as an RFC) before they can conduct any business in Mexico. You can obtain an RFC from the Mexican Tax Administration Service (SAT).

Registering with the Ministry of Economy

All businesses must register with the Ministry of Economy, which will issue an official certificate of registration.

Registering for Social Security

If you plan to hire employees, you’ll need to register with the Mexican Social Security Institute (IMSS) and pay contributions.

Obtaining a Business License

Depending on the nature of your business, you may need to obtain a business license from the local government.

Opening a Bank Account

To conduct business in Mexico, you’ll need to open a bank account in the name of your business.

Frequently Asked Questions

What are the costs associated with setting up a business in Mexico?

The costs associated with setting up a business in Mexico vary depending on the legal structure of your business and the services you need. However, you should plan to budget for legal and accounting fees, government registration fees, and taxes.

What are the taxes for Mexican businesses?

Mexican businesses pay federal and state taxes, including income tax, value-added tax (VAT), and payroll taxes for employees.

Can foreigners own a Mexican business?

Yes, foreigners can own a Mexican business. However, there are restrictions on certain industries, such as banking and broadcasting, which require Mexican ownership.

What are the employment laws in Mexico?

Mexican employment laws are covered by the Federal Labor Law, which sets out the rights and obligations of both employers and employees. These laws cover issues such as minimum wage, working hours, vacation time, and termination procedures.

What industries are popular for new businesses in Mexico?

Mexico is a rapidly growing economy with many opportunities for new businesses. Some popular industries for startups and small businesses include manufacturing, food and beverage production, tourism, and technology.

Starting a business in Mexico can be a rewarding and profitable endeavor. By following these guidelines and understanding the legal requirements, you can establish a successful business in this vibrant and exciting country.