ISR (Impuesto Sobre la Renta) (Income / Capital Gains Tax)eem-PWES-toh SOH-breh lah REHN-tah
ISR (Impuesto Sobre la Renta) is Mexico's federal income tax, levied on income from all sources including salaries, business profits, rental income and capital gains from property sales, governed by the Ley del Impuesto Sobre la Renta and administered by SAT.
By Daniel Ortega · Last reviewed 12 November 2026
How it works
For foreign property buyers in Quintana Roo, ISR becomes relevant in three situations. On a property sale, a non-resident seller pays ISR as capital gains tax under Article 160 LISR: either 25 percent of the gross sale price with no deductions, or 35 percent of the net gain after deductions (indexed purchase cost, improvements with facturas, fees, commissions) when the sale is formalized in escritura pública. Mexican tax residents use progressive rates up to 35 percent on the net gain and may claim a primary-residence exemption under Article 93 for sales up to 700,000 UDIs. On rental income, non-residents pay 25 percent of gross rents, while residents use progressive rates. The notario withholds ISR at closing on sales; rental ISR is paid monthly or annually through SAT. Buyers do not pay ISR when purchasing, only when selling or renting.