In Mexico, year-end Transfer Pricing adjustments are decided before December 31, not when the documentation for the following year is prepared. The fourth quarter is the time when a group can still compare its actual margins with the arm’s-length range and correct the difference with orderly tax effects.
The Miscellaneous Tax Resolution for 2026 (RMF 2026) devotes Section 3.9.1 to these adjustments. Its five rules define what constitutes an adjustment, when it increases or decreases income and deductions, and the methods by which an adjustment that reduces the tax base may be deducted.
What does Section 3.9.1 of the RMF 2026 regulate?
Rule 3.9.1.1 defines a transfer pricing adjustment as any modification to the prices, amounts of consideration, or profit margins of transactions with related parties, so that they match those that independent parties would have agreed upon in comparable transactions. The following four rules establish their tax consequences.
| RMF 2026 | What does it regulate? |
| 3.9.1.1 | The concept of transfer pricing adjustments and their types. |
| 3.9.1.2 | Increase or decrease in income or deductions resulting from adjustments. |
| 3.9.1.3 | Deduction of the adjustment in the tax year in which it was recognized. |
| 3.9.1.4 | Deduction of the adjustment following prior notice to the SAT. |
| 3.9.1.5 | Deduction of the adjustment resulting from a ruling issued pursuant to Article 34-A of the Federal Tax Code (CFF). |
Rule 3.9.1.1 itself distinguishes between actual adjustments—which have both tax and accounting effects—and virtual adjustments—which have only tax effects. It also classifies them based on who initiates them: voluntary, primary, correlative, and secondary. A year-end adjustment decided by the taxpayer is a voluntary adjustment.
Why isn’t an upward adjustment the same as a downward adjustment?
The effect of the adjustment on the tax base determines the level of scrutiny. An adjustment that increases taxable income or reduces deductions increases the taxpayer’s tax liability. Therefore, it is subject to less scrutiny.
Downward adjustments—which reduce taxable income or increase deductions—are subject to specific requirements. To ensure deductibility, the RMF 2026 establishes three potential avenues: recognition within the same fiscal year (Rule 3.9.1.3), prior notification to the SAT (Rule 3.9.1.4), or a Transfer Pricing resolution under Article 34-A of the Federal Tax Code (Rule 3.9.1.5). The applicable route depends on the timing of the adjustment and the available supporting documentation.
What needs to be ready before closing the fiscal year?
A year-end adjustment is supported by evidence generated during the fiscal year itself, not by a study prepared months later. In practice, three elements must be aligned.
The first is the technical calculation. The adjustment must be based on a comparability analysis that explains why the original margin did not reflect arm’s-length conditions and what the corrected value is, as required by Article 76, Section IX, of the IRS.
The second is the documentary and accounting support. A real adjustment involves issuing or receiving the corresponding CFDI and recording it in the accounting records, whereas a virtual adjustment is reflected only in the tax reconciliation and on the tax return.
The third is consistency with the related party. If the foreign entity does not recognize the adjustment in its jurisdiction, the group may be taxed twice on the same profit.
When a downward adjustment is not recognized in the fiscal year, the procedure under Rule 3.9.1.4 requires prior notification to the SAT. The lack of planning that leads to this procedure adds a step that could have been avoided with a timely review of profit margins.
Why do the range and the median matter before December 31?
The endpoint of the adjustment is not just any value within the analysis. Article 180 of the Income Tax Law (ISR) provides that the range of prices, amounts, or margins may be adjusted using statistical methods, and Article 302 of its Regulations establishes that, if the taxpayer’s value falls outside the interquartile range, the median of that range shall be considered the arm’s-length value.
This carries a direct practical consequence. A margin that closes the fiscal year below the range is not corrected by simply bringing it up to the lower limit; rather, it is subject to an adjustment to the median if audited by the tax authority. For this reason, it is advisable to project the expected margin for the fiscal year during October and November and compare it against an updated range, while there is still time to invoice the adjustment via a CFDI.
This projection also helps determine the type of adjustment required. An actual adjustment invoiced within the same fiscal year leaves a clear accounting and documentary trail for both parties, whereas a virtual adjustment is limited to the tax reconciliation and does not correct the records of the related party.
What’s at stake in the final quarter?
Section 3.9.1 of the RMF 2026 provides for the correction of the transfer pricing figures for the fiscal year, but rewards those who do so on time. An upward adjustment is incorporated without significant friction; a downward adjustment depends on how and when it was recognized, and on whether the calculation, the CFDI, and the counterparty all tell the same story.
At TPC Group, in every year-end analysis, we evaluate the projected position of margins relative to the fully competitive range and determine the appropriate type and method of adjustment under the current RMF. Our objective is to ensure that every transfer pricing adjustment is deductible, properly documented, and consistent with the jurisdiction of the related party.