CFDI Retention: What Is It and How Is It Used?

The CFDI Retention is a type of digital tax receipt used to document the tax withholdings made by a taxpayer on payments received by another party. These withholdings are linked to various fiscal provisions in Mexico and are primarily used to ensure that taxes are properly withheld and paid to the Tax Administration Service (SAT).

Below, we explain what the CFDI Retention is, when it should be issued, and how it is used in practice.

What Is the CFDI Retention?

The CFDI Retention is a digital receipt issued to report the taxes withheld on payments made. The withholdings can be related to the Income Tax (ISR), Value Added Tax (IVA), or Special Tax on Production and Services (IEPS), among other taxes.

This type of CFDI is used by individuals or companies that are required to withhold taxes on the payments they make to suppliers or employees.

When Should a CFDI Retention Be Issued?

The CFDI Retention should be issued in the following cases:

• ISR Withholding: When a taxpayer makes a payment to a third party for professional services, leases, or other purposes, and must withhold a percentage of the payment as ISR.

• IVA Withholding: In some cases, when the payment is subject to IVA withholding, the withholding taxpayer must issue a CFDI Retention.

• IEPS Withholding: In certain payments related to specific products (such as alcohol, gasoline, etc.), the taxpayer must withhold IEPS.

How Is a CFDI Retention Issued?

To issue a CFDI Retention, the following information must be included:

1. Withholding Taxpayer Details: The individual or entity making the tax withholding.

2. Recipient Details: The individual or entity to whom the tax is withheld.

3. Type of Withholding: Specify the type of tax withheld, such as ISR, IVA, or IEPS.

4. Amount Withheld: The exact value of the tax withheld.

5. CFDI Complements: In some cases, such as payroll CFDI, additional complements detailing the withholdings must be included.

What Information Does the CFDI Retention Include?

The CFDI Retention has a similar structure to the standard CFDI, but with additional fields for the withheld taxes. Some key elements include:

• ISR, IVA, or IEPS Withholding: Specify the type of withholding.

• Amount Withheld: The exact amount withheld for each tax.

• Retention Date: The date the withholding was made.

• Withholding Taxpayer’s Tax Regime: Fiscal information about the taxpayer making the withholding.

• Recipient’s Tax Regime: Fiscal information about the person or company to whom the tax was withheld.

How Our API Helps with CFDI Retentions

Our CFDI Stamping API supports the issuance of CFDI Retentions, allowing you to automate and streamline the process of generating these receipts. With our solution, you can efficiently issue ISR, IVA, and other tax withholdings, ensuring the fiscal compliance of your operations.

Benefits of Using Our API for CFDI Retentions:

• Automatic Compliance with the SAT: You’ll always stay up to date with the latest fiscal provisions.

• Efficient CFDI Generation: Automate the issuance of CFDI Retentions to avoid manual errors.

• Full Support: Simple integration for various types of withholdings and tax complements.

Why Are CFDI Retentions Important?

The CFDI Retention is a key document to ensure that taxes are properly withheld and reported to the SAT. Issuing it correctly guarantees compliance with tax laws, avoiding potential sanctions from the fiscal authorities. It also helps taxpayers accurately deduct taxes and improves transparency in business transactions.

Would You Like to Issue CFDI Retentions with Ease?

With our CFDI Stamping API, you can simplify the issuance of these receipts and keep your accounting up to date. Contact us for more information on how we can help you automate your electronic invoicing and comply with fiscal regulations.