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Young(ish) couple moving from Europe on a retiree visa

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OriaXu
10/9/2018 10:03 EST

Hi all,
My wife and I are 35 years old and we want to move to mexico (Jalisco) mid 2019. I am retired and my wife and I do not plan to work in mexico.

I have been looking around a lot and it is quite hard to find any kind of information that not specifically about US expats.
If anyone can help me answer these questions of at least point me in the right direction (web-sites or information on who to contact) that would be greatly appreciated!

-1-
My pension is paid by the state of Luxembourg (EU) onto my bank account in Luxembourg. So my first question is:
If i open a bank account in Mexico to have my pension paid directly onto it, will i have to pay taxes in Mexico again? (my pension is of course being taxed in Luxembourg)

-2-
My second question is about buying a house/land.
In order to buy a house or land in mexico i need to transfer my money or pay the seller directly from my Luxembourg account. (I am by no means rich, the amount will be in the 400.000€ after we sell out house/car/stuff and pay off our debts)
Can this be done without paying insanely high taxes on it? I mean can i buy a house/land for that amount without having to pay extra taxes just because the money is entering Mexico?
Or so I have to wire 9999€ every month until all the money is in Mexico, like it needs to be done in countries like Switzerland to avoid taxation?

-3-
My third question is about the healthcare.
I will be in Mexico on a permanent visa (retiree) and my wife will be on a long term visa (family reunification program). None of us will be working.
Do we need to buy a private health insurance? Or do we qualify for the national healthcare?

Thanks for any advice or answer you can provide.
Regards,
Steve.

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NA
10/9/2018 11:27 EST

Search for Two Expats Mexico on Facebook. From there you can access their website. You will find lots of answers there. I am building a house so I have been sending large amounts. I will not have to pay taxes for those amounts as they are going directly into a checking account that does not bare interest.

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YellowTail
10/9/2018 17:05 EST

In Mexico - it is 'real' interest that is important. That is interest after inflation. With, say, an investment that returns nominal interest of hundred of thousands of pesos - it is very easy to earn a negative real interest rate. You need to earn in excess of 100,000 real interest before you will owe Mexico taxes on those earnings. It is hard to get in that position.

You do still need to report the nominal interest earned to the US (no idea about the EU) and then take a foreign tax credit if appropriate.

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OriaXu
10/10/2018 01:59 EST

Thanks "NA" for the FB connection and for the provided information so far!

And thanks "YellowTail" also, very informative!

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bellissimos
10/10/2018 09:13 EST

First of all, WELCOME Steve and your wife to Jalisco, MX...presumably, the Lake Chapala area/Ajijic! Your questions are easily answered...but probably not in a public forum.

I can answer many as a person who came here 20 years ago, also young, and still LOVE living here. I can also direct to the right professionals in each area....that would be much better than listening to just 'us'...as we all have opinions and real reasons for those opinions...but that does not make them true.

If you'd like to talk more, write me at lfossi@hotmail.com and I will direct you with phone numbers and emails of those who can give you the best advise.

Just as a note, you won't be 'double taxed'...so don't worry about that. And you do not have to have your money 'here' to buy a home here...wire transfers are done everyday from around the world...that is standard operating procedure!

Good luck and I hope to hear from you.

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YellowTail
10/10/2018 13:43 EST

Well Linda - don't you think your post kind of conflicts with the role of forums such as this ?

You probably should have sent Steve a private message with your solicitation. Something like - Hi Steve, I am a realtor in the Chapala area and I and my associates would love to speak to you as a potential client.

Rather than - Steve - you really can't trust the information you read on forums such as this...

Do you have something in particular which was posted that you find to be untrue ? I can question something in your post. Yes the US and Mexico have a Tax Treaty which prevents double taxation. Have you researched if that is true for the country of Luxembourg ?

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NilesS
10/10/2018 14:05 EST

Hello, please don't buy a house or transfer large sums of money into Mexico until you have actually lived there for a while. It may or not be your cup of tea.

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YellowTail
10/10/2018 14:15 EST

Good advice. We rented for a year and took the time to look at perhaps 200+ houses until we found what we wanted.

The couple we purchased our house from (German/Columbian) had it on the market for something like 5+ years before we bought it. And they had it listed with several big name realtors.

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YellowTail
10/10/2018 14:15 EST

Good advice. We rented for a year and took the time to look at perhaps 200+ houses until we found what we wanted.

The couple we purchased our house from (German/Columbian) had it on the market for something like 5+ years before we bought it. And they had it listed with several big name realtors.

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OriaXu
10/11/2018 01:40 EST

Hello all, it's taking me longer to reply due to the -7 hours time difference!

First off thanks for all the information you provided so far!

Before i start with my replies:
If anyone has any link or personal tips on where to get some info about the healthcare... since we are both not going to work in Mexico, but not old enough for the senior healthcare program which starts at 60 from what i could find and all the results i get are targeted to US citizens who have US healthcare, i am struggling to find a clear answer...
My guess is we will have to buy private healthcare, but might as well ask here since i am here for tips/info anyway!

=In reply to Mrs Fossi=
I actually wanted to have a look at your website... and got this message:
"403: Access Forbidden
Your location (DE) has been blacklisted."
I am not using a VPN or any software that hides my IP, so this is my regular IP here on the German border... so that's kinda interesting i guess.

But thanks for the "double taxed" info, as that was a very important piece of information! Since I will be providing alone for my family, this could have been a setback (we plan to have children in Mexico).

A friend of mine who works at the government linked me some legislation pages who seem to confirm this as well,
As a note, Luxembourg is a tiny country with 3 official languages. And sadly its not always as easy as a google search to find a real answer that is actually from Luxembourg... Depending on what language you type your search in, you mostly get search results from France, Belgium, Germany or if searching in English you end up with UK/USA results.


=In reply to NilesS and YellowTail=
Yes that is exactly what we planned.
In the past year we spent over 4 months in Mexico, Dec-Jan Mai-June and Sept-Oct (just got back).
If everything works as planned, we will sell our belongings here by mid 2019 and move to a rental home in the GDL outskirts area. Once there we want to "settle in" and take our time to find the right home for us.

I started to learn spanish casually about 2 months ago, which isnt too hard since i speak French, German, English and Luxembourgish, Spanish comes quite easily.
But that is one of the main things we want to do as soon as we hit Mexico (or shortly before), is learn Spanish properly, which will help a lot with our search for a new home.

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YellowTail
10/11/2018 07:14 EST

Regarding healthcare. we have coverage through a government program called IMSS.

http://www.imss.gob.mx/

It has its good and bad points. If you are youngish and healthy it may be all you need. The coverage kind of fades in over a few years. You will need to research it for yourself to see if it might meet your needs, We pay out of pocket if we are in a hurry.

Have you visited a Mexican consulate yet to determine the Mexican visa requirements (eg financial subsistence). You may need to have a resident visa to qualify for IMSS, I'm not aware of what insurance you are referring to that kicks in at 60.

I searched myself regarding which countries Luxembourg has a tax treaty with. It appears that it does have one with Mexico but you would be lucky because the list of countries was the EU and perhaps 6-8 others - which to me didn't seem like a lot.

Where we live there is very little spoken other than Spanish - but we got lucky that we hooked up with a realtor whose family owns the local Century21 franchise with a Canadian/Mexican background.

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YellowTail
10/11/2018 07:45 EST

Also - regarding moving monies into Mexico - there is no Mexican governmental taxation on those transfers. You do however need to be smart. Some institutions will charge fees, all institutions will charge an exchange rate to convert money to pesos. Often the larger the amount the better the exchange rate. But - you do not want to pay someone 3% of your hard earned money to move it to Mexico... I would move money via a 'brokerage' rather than a 'bank'.

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longtimelurker
10/11/2018 07:58 EST

Oriaxu, I have private health insurance. It is cheap compared to USA prices. I have never had to use it so I can't tell you anything other than it is cheap. I have seen the SP General and IMSS hospitals. If you can afford private go with it.

What areas of Mexico have you looked at? Why the GDL area? Where in the area do you like?

Yellow, Good post about Linda. Beware of people with hidden agendas.

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NA
10/11/2018 10:32 EST

I use TransferWise to send money to Mexico. You will need a bank account in Mexico to use it. They give you the Mid-Market rate,much better than a bank.

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OriaXu
10/13/2018 10:10 EST

=In reply to YellowTail=

Thanks for the healthcare like and especially for the brokerage vs bank tip, i will definitely keep that in mind!!


=In reply to longtimelurker=
That's what i was thinking too and i will check what the cost of private would be for us!
But it's still good to know if I/we would qualify for the national healthcare system, as i would like to minimize spending money as much as i can when we arrive in Mexico, at least until we have found and bought something.

Our first choice was to move to the Puerto Vallarta area, since we have been there over 10 times in the past years. But due to a few factors, one of the being the insane heat during the Sept-Nov perido, we decided to pick the GDL area.
We want to live "away" but still within an hour of a city that has it all, like good schools/hospitals etc.
Also I want to buy small place in PV after a few years in our new home, so we can get to PV by car with our dogs during the low heat/tourism seasons.

The region in general, other than because we have been there many times, was picked due to a few other reasons, like weather (not in the hurricane region), temperatures (stable all year around), out of the main earthquake zone, etc etc

But we are not going to pass on a great opportunity in another region should one present itself of course.

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longtimelurker
10/14/2018 07:12 EST

OriaXu, don't rule out the coast, you will acclimate to the climate. There is a large family raising, working, EU expat population in Playa del Carmen and Cancun. Good schools, good hospitals and very easy access to Europe.

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NilesS
10/14/2018 14:29 EST

I still have a fondness for Cuernavaca, mainly because of the pleasant weather and nearness to Mexico City. Cons: security concerns and earthquakes - you can't have it all. Also, the area to the north of Mex. City - Queretaro, San MIguel, etc. has nice weather a bit dryer I think and lots of scenic beauty. But I'm sure there are cons there also, as everywhere.

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YellowTail
10/14/2018 15:34 EST

NilesS - I'm not disagreeing with you but Cuernavaca is a kind of a big place with over 300 Colonias/Fraccs. The elevation range is roughly 7000 ft to 3500 ft. The elevation in the center is around 5000 ft. Whoever dreamed up 'City of Eternal Spring' must have spent a lot of time in the center because it can be down-right frigid as well as oppressively hot. But - I'm sure there are worse places to live...

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NilesS
10/15/2018 03:15 EST

yes, I stayed in the central part of the city.

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CLK32
10/15/2018 09:05 EST

Make sure you understand the vagaries of living in a corrupt country. While not common if a Mexican likes your land they can pay a judge to award it to them. You cannot own land within 26 miles of the coast but have a corp that owns it for you or a bank holds a trust (FIDEICOMISOS), Not necessarily a bad thing but it is a fact of life. Make sure you understand ejido land which is an issue on the Tulum beach. Make sure you understand mordida and are willing to pay it. A title can sit on a bureaucrats desk for months unless you pay the bribe to move it along.

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OriaXu
10/15/2018 10:29 EST

Well I can guarantee that we will not move to eastern mexico, simply because of the hurricane risk around the whole gulf.
Same goes for the southern coast, to avoid earthquakes.

Like i said, we narrowed our selection on the GDL area due to many reasons, but we are not ruling anything out, if we find the "perfect home" somewhere else we will not rule it out and of course look into the region/area.

=In reply to CLK32=
Thanks for the info!
The "ejido land" seems to be the same as in Spain, we bought land there a few years back and had a few issues/surprises there with all that crap...

As for the corruption, i guess it depends of the region, which is one of the reasons i want to live near a major city, as I have have read that bureaucracy bribes/corruption and more common in smaller cities.

But since my Spanish will not be great by the time we move, I plan on having a lawyer take care of everything for us and making sure everything is 100% as it should be before we pay for anything.

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CLK32
10/15/2018 11:16 EST

Ejido land was an attempt by The Mexican government to create reservations for natives much like the reservations in the US. It was subsequently divided up with Deeds going to individuals and today there can be multiple Deeds for the same piece of land floating around. you might do a little more research on the legal system in Mexico because notary publics are much more involved in real estate than lawyers are. Mexican law is after all based on the Napoleonic Code. I looked at starting a business in the Playa Del Carmen area and decided against it because of all of the fraud and Corruption.

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CLK32
10/15/2018 11:44 EST

I want to add that renting and networking with local expats to learn the specific situation would be the prudent way to go about it.

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kikipt
10/15/2018 12:51 EST

CLK32, What you say about deed issues with ejido land is correct, but your comment about the origins of ejidos is simply not. Ejidos were not reservations at all, but an important part of land reform after the revolution, beginning with President Cárdenas in 1934. It was an attempt to restore land control back to the indigenous people, most of whom were living as serfs, and hence virtually powerless, up until then. They were essentially communal parcels (and generally the poorest and least productive land around) where the local government could then distribute plots for each family to farm. The deed problems arose because of fraudulent banking practices, especially when the ejiditarios sought loans for improvements. The fact that ejidos still lacked the standing of big corporations and the previous hacendados, and most ejiditarios were uneducated, left them open to abuse by the powerful elites, who had no intention of just seeing their hereditary riches being given back to the original owners. Virtually every administration after Cárdenas was antagonistic to the ejidos - they knew where the real money was, and it wasn't with the indigenous poor. Hence parts of ejidos were sold off without clear title, and the titles reman in question today. It is wise to avoid trying to purchase ejido land in any instance, and incumbent on buyers to do due diligence prior to purchasing.

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longtimelurker
10/15/2018 16:54 EST

OriaXu, GDL is a good landing spot. It is growing into a tech center with jobs. There is a strong middle class.

Good luck in your new adventure.

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CLK32
10/16/2018 08:05 EST

Comparing ejido land to reservation is a common thing. http://www.forsaleinbaja.com/the-what-and-why-of-ejidos-part-1.html

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kikipt
10/16/2018 09:59 EST

One example hardly makes something "common" and it also does not make it accurate.

The article to which you link is a pretty good article. She obviously knows far more about Mexico's history than you do. But the content of the article does not support the comparison she makes in the second paragraph. She is incorrect, as were you, in comparing ejidos to American reservations. Indigenous people in Mexico were not forced onto ejidos as my Cherokee and Choctaw ancestors were forced onto reservations in Oklahoma.

Ejidos and reservations originated for, and served, completely different purposes. It is an affront to both groups to equivocate their histories,

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Jamais
10/16/2018 19:02 EST

I would HIGHLY recommend private insurance or else you will be forced to deal with the public system (think long lines, mountains of paperwork, not the most sanitary conditions, shared hospital rooms, bring your own toilet paper, and much more. If you are interested in PRIVATE health insurance which allows you to use any hospital in the world and choose your own doctors, please get in touch with me. I can assist.

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CLK32
10/17/2018 09:06 EST

"One example hardly makes something "common" and it also does not make it accurate.

The article to which you link is a pretty good article. She obviously knows far more about Mexico's history than you do. But the content of the article does not support the comparison she makes in the second paragraph. She is incorrect, as were you, in comparing ejidos to American reservations. Indigenous people in Mexico were not forced onto ejidos as my Cherokee and Choctaw ancestors were forced onto reservations in Oklahoma.

Ejidos and reservations originated for, and served, completely different purposes. It is an affront to both groups to equivocate their histories,"

all I can see is you are just being a key board cowboy, you havent proven anything but I have.

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kikipt
10/17/2018 11:29 EST

You have proven NOTHING! You claim that it was "common" to equivocate ejidos and reservations. That would require a bit more than one example, though that single article you cite is obviously your only contact with the subject. I don't know what the hell your problem is, but calling someone a "keyboard cowboy" just because they read carefully, do research, and understand terminology, and you clearly do not, is petty and stupid. Do even a little bit of research about what a "reservation" is. look it up on wikipedia, though it is probably far too long an article for you to process.
https://en.wikipedia.org/wiki/Indian_reservation
Use your brain for once in your life. The description given in the article to which you linked, which you obviously are too damn stupid to be able to understand, does not match that of a reservation in any way. Ejidos were created for one purpose and one purpose only - land reform to relieve the yoke of European-imposed feudalism which restricted the rights of indigenous people. (Perhaps as a self-entitled gringo that does not register on your radar.) And learn what ejidos really are - they are very active and important parts of indigenous community in Mexico:
https://en.wikipedia.org/wiki/Ejido
or perhaps https://www.britannica.com/topic/ejido
That is NOT the case with reservations. They are not even remotely the same concept. Ejidos were the taking of land away from large European and mestizo land barons to return them to the original people and restore control to local interests. Reservations were the opposite - taking of the majority of tribal lands by the European invaders and leaving the tribe as little as possible, forcibly relocating the tribal members and restricting their rights to the small parcels remaining. So stop flaunting your ignorance and STFU. Better yet, go back to the US with all the other trumpistas who have no intelligence and no respect for facts, history, or human rights, and who live in the sort of bubble you exemplify. Mexico certainly does not need more assholes like you! And if you ARE going to live here - bother to learn the language, bother to learn the culture, and bother to learn the history!

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morepaul
10/17/2018 14:11 EST

I would prefer if you woukd take your anger and perhaps try to manage it elsewhere. There is no room for someone of your ilk on this forum. Please do not waste anyones time with a nasty respinse. Thank you.

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kikipt
10/17/2018 15:28 EST

And I would prefer if people would use a little intelligence before posting on a public forum. Perhaps they could do research, read carefully or give a little thought to what they are posting instead of just copying from other people's articles, which is obviously what CLK32 did.

For YOUR information I read this forum for a long time before I moved to Mexico, and the bad advice given from people who didn't know what they were talking about cost me money and time. What right do people like you, people who are lazy or stupid - and get your little feelings hurt just because someone calls out your BS - what right do you have to cost other people time and money?

My ilk? How dare you be so rude, nasty or presumptuous. You are no better than CLK32. Angry? - you're damned right I'm angry with the myopia and willful ignorance that is destroying my country and the countries around it, a myopia and willful ignorance to which you obviously subscribe.

I will not apologize for being intelligent and perceptive, for being able to read or for knowing the history of both my own native country and of my adopted country. You can take your "advice" and shove it "where the sun don't shine."

As for being a "nice person" I see nothing nice about allowing false information or prejudicial viewpoints just pass as they may just because it makes YOU feel superior. Niceness is far more than that, and I will put my record for helping people and caring for people up against yours any day, whoever you are!

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OriaXu
10/18/2018 10:39 EST

Hey again!

Thanks longtimelurker!
We love mexico, the culture and the people, and GDL, even with its problems, should be a good starting point!

Jamais
Thanks, we will be going for Private insurance, i checked out many more sites and I also think it would be the best and safest way.
Especially since I will be much more fluent in English as in Spanish for the first couple of years (i hope not decade), it will make our lives easier to go private.

Thanks again all, you provided some much needed information!
Regards,
Steve.

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barquentine
10/29/2018 12:13 EST

OriaXu:
400,000 Euros, frankly, is way too much to spend unless you intend living in a huge mansion. You can buy a fabulous house in that area for half of that.
Ultimately, private health insurance is not affordable, so I would plan on beginning with private and at the same time pay monthly into the national system so as to get cover when you're old.

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