Mexico

Mexico Payroll & HR Glossary

IMSS

The Mexican Social Security Institute, which provides social security; its cost is shared between worker and employer.

ISR

The Impuesto Sobre la Renta (income tax) levied on income; in payroll the employer withholds it according to the SAT's table.

Aguinaldo

A mandatory annual benefit equal to at least 15 days of salary, payable before December 20.

Finiquito

The payment of outstanding amounts when the employment relationship ends (salary, plus proportional vacation, vacation premium and aguinaldo).

Prima vacacional

An additional payment of at least 25% on the salary corresponding to the vacation days.

PTU (reparto de utilidades)

The workers' share in the company's profits (Participación de los Trabajadores en las Utilidades), paid once a year.

Infonavit

The institute that administers the national housing fund; the employer contributes 5% of the worker's salary.

Sueldo neto

What the worker receives after subtracting ISR and the employee IMSS contribution from gross salary.