Mexican Law/Selling my condo in Mexico
Hello, thank you very much for taking the time to read my question.
I am a Canadian and bought a home in Puerto Vallarta, Mexico in 2005. At the time of purchase we received two sets of documentation, one in English and one in Spanish. The "deed" was written in Spanish. We paid $168,500 US Dollars for our condo and today we are selling it for $171,000. It was not a good investment!!! But the question that I have --the "deed" did not show the amount that we paid for the condo. It showed an amount in pesos that was in US dollars almost $100,000 less. We DID sign the deed but did not know that we were signing a legal document saying that we only paid $68,000 for a two bedroom penthouse condo!
We have all the documentation proving that we paid $168,500 but the notary and realtor that we are now using to sell the condo continue to say that we have to pay capital gains of US$33,000 because "We signed the deed". I do not know why the deed was fraudulent or how the original realtor and notary got away with it, but I would really like to know if there is ANYTHING we can do.
This condo is all the money I have. To pay $33,000 for a capital gain that is NOT REAL is very, very hurtful. My realtor tells me it is our own fault. We signed the deed.
I would very much appreciate your answer on this. I have lived in Mexico for ten years and I am now 59 and would like to return to Canada. This has left me feeling very angry with Mexico. Not a nice way to leave.
Thank you for your help,
The custom in Mexico regarding sales contracts for land is as follows: The value of the transaction is listed as the accessed value of the property. This is so all parties reduce expenses and taxes. In your case, I strongly suspect the accessed value of the property was $68,000.
Now that you want to sell the property, you should sell it (on paper) for the same acessed value.
What the contract says and the actual amount transacted are two distinct issues. In the US this way of doing business would be tax fraud. Technically it may be illegal under Mexican law as well but, in this case, the mob rules.
Hope this helps
Lic. John Lee Ward