Property Tax (Predial) in Mexico: How It Works and What If You Don't Pay

The property tax (impuesto predial) is the levy every owner pays each year to their municipality for holding real estate. Although the amount is usually small compared to other taxes, not paying it generates surcharges and can prevent you from selling or closing a deed (escrituras). In this guide we explain what it is, how it is calculated from the assessed value (valor catastral), and what happens if you fall behind.

What is the predial?

The predial is a municipal tax levied on the ownership or possession of real property—land and buildings. It is one of the main sources of revenue for municipalities, and it funds public services such as street lighting, trash collection, and urban maintenance. It is paid by the owner or possessor of the property at the start of the fiscal year.

The assessed value, the basis of the calculation

The assessed value (valor catastral) is the value the authorities assign to your property for tax purposes. It is generally lower than the commercial value (the market price), although municipalities update it periodically to bring it closer. It is made up of the value of the land plus the value of the buildings, taking into account location, size, use, and features.

How it is calculated

The general formula is simple: a rate or tariff is applied to the assessed value. Many municipalities use bracketed tables with a fixed fee plus a percentage on the excess, so properties with a higher assessed value pay more.

When and where to pay

The predial is usually paid annually during the first months of the year, although many municipalities allow bimonthly payments. You can pay it at the municipal treasury offices (tesorería municipal), online through the city government's portal, at authorized banks, or at partner establishments. You will need your cadastral key (clave catastral) or the predial account number that appears on previous bills.

Discounts and benefits

Paying early in the year almost always pays off: the early-payment discount can represent a significant percentage of the annual amount.

What happens if you don't pay

The most sensitive point for owners is the certificate of no debt: without it, you cannot close a sale before a notary. If you plan to sell your property, get current on your payments before starting the process. This certificate is also one of the documents the notary public (notario público) requires, as we explain in our guide to notary fees.

Frequently asked questions

Does the owner or the tenant pay the predial?

By law it is the responsibility of the owner or possessor of the property. In a rental agreement, the parties can agree on who covers it, but as far as the municipality is concerned, the responsible party is the property's titleholder.

Can I pay predial for past years?

Yes. You can regularize past debts by paying the principal plus surcharges and inflation adjustments. Many municipalities open temporary surcharge-forgiveness programs that are worth taking advantage of.

What do I need to pay if I lost my bill?

The cadastral key or predial account number is enough. You can get them at the municipal treasury by presenting an ID and details about the property, or look them up on the city government's online portal.

Does the assessed value affect other taxes?

Yes. The assessed value also serves as a reference for calculating the ISAI (property acquisition tax) when you buy, and it can influence other procedures. That is why it's worth making sure it reasonably reflects the property's characteristics.