The personal expenses that Mexicans deduct the most from taxes

These 10 concepts, in order of cost to the treasury, are:

More and more people are deducting their personal expenses. According to the Treasury, between 2003 and 2021 the amount of personal deductions declared by taxpayers grew by around 384.8% in real terms, which is equivalent to an average growth rate of 9.2% in said period.

When filing their annual tax return, taxpayers can include these expenses that help reduce their tax burden, and have balances in their favor with the SAT, which can be returned to the taxpayer or taken as compensation for future returns.

The overall limit on personal deductions is equivalent to 15% of the taxpayer’s gross income or five annual UMAs, whichever is less.

According to the SAT, the global limit excludes tuition fees, complementary retirement contributions, those to personal retirement plans contracted individually or collectively or to the voluntary contributions subaccount, deposits in special savings accounts, as well as premiums for pension plan insurance contracts and shares of investment companies and fees and medical expenses for disability and incapacity.

Although all individuals can apply personal deductions, since those who earn annual cumulative income of up to 400,000 pesos are not required to file their annual tax return, among other reasons, many people do not exercise their right even when they could have applied said deductions, says the Treasury.

To some extent, this means that, according to statistics from the annual declarations of individuals for the 2021 fiscal year, lower-income taxpayers had greater restrictions when applying their personal deductions, since the binding factor of their overall limit is income, detailed the 2024 Tax Waiver report, which sets the path to the delivery of the 2025 economic package.