Payroll Outsourcing in Mexico
Mexico Payroll Service
No matter where you need it, our team of local experts at GlobalPEO will manage all of your foreign payroll operations. We get it; coordinating payroll is challenging enough on its own, and can become a logistical nightmare once multiple languages, rules, and regulations are involved.
We are proud to streamline the experience to guarantee compliance and make your global expansion into China a breeze.
Learn how Mexico’s laws and regulations surrounding taxes will impact your hiring and payroll processes.
Depending on the size of your business and your specific needs, GlobalPEO offers a variety of payroll solutions to make sure you’re covered with full compliance, no matter what.
In order to set up payroll services in Mexico, you will either need to set up a subsidiary of your own, or work with an International Payroll company like us here at GlobalPEO.
When setting up an employment contract in a foreign country, there are unique rules and regulations you must follow to ensure full compliance. Learn more about the specific terms that are required for all contracts in Mexico.
Mexico Payroll Outsourcing Benefits
Mexico's Taxation Laws & Regulations
Employees working in Mexico are required to pay high income taxes which can reach up to 35%. Employees have the opportunity to open an “Administrator of Retirement Funds” account that they can contribute to on a monthly or yearly basis. There are a variety of AFOREs available, so employee’s must choose which fund they would like to contribute to before adding funds to an account. If an employee fails to designate an AFORE after 1 year of employment, a low-commission fund will be automatically assigned to their name.
Employer’s are required to contribute up to 10% of the employee’s paycheck to their retirement fund, which covers unemployment due to old age, housing costs, and additional retirement related expenses as negotiated by the employee or their representing labor union.
Payroll Options in Mexico
Depending on the size of your company, you can choose between a two primary payroll options to find one that best fits your needs.
Option 1 – Set Up Your Own Subsidiary
Large companies will sometimes decide to handle their foreign employee payroll process on their own. In order to do this, you will be required to set up a subsidiary, register your business in China, and have a deep understanding of the country’s taxation, withholdings, benefits, and other local payroll conditions.
Option 2 – Work With an International PEO
When you work with GlobalPEO, our Payroll solutions make things easy by handling all of the administrative and HR duties with the employee. This frees up your business and foreign employees to focus all of your communications on the work itself.
How To Set Up Payroll In Mexico
Employers in Mexico must register their business by filing their official documents with a notary present as well as the National Registry of Foreign Investment. Before being able to pay your employees, you will be required to register your company with Mexican Social Security and get official tax registration in the country. You will also need to establish a bank account in Mexico and pay your employees in the Mexican Peso.
Entitlement & Termination Terms For Mexico Payroll
Employment contracts in Mexico must clearly state the employees’ responsibilities, compensation details, benefits, grievance procedures, and requirements for termination. Most contracts also specify provisions relating to employee confidential information and non-compete restrictions.
While it is required to provide a probationary period before terinating an employee, we recommend that you do not designate a probationary period that lasts longer than 30 days. If an employee’s probationary period exceeds 30 days, the employer may be subject to paying severance for the employee following their dismissal.
If not expressed otherwise, all employment contracts in Mexico are assumed to be for an indefinite term-length.
Employment agreements in Mexico may be terminated by a mutual agreement between employee and employer, the death of the employee, or a physical or mental disability that renders the employee no longer capable of performing the required work duties.
From providing quick and effective payroll solutions to creating great relationships with your foreign employees, GlobalPEO gives you a top tier International Payroll service at a value unmatched in the industry. With Mexico PEO services starting at just $400 per employee, your business can enjoy the benefits of having an expert payroll team without breaking the bank.
Why Choose GlobalPEO?
Global expansion is a great step for your business – and now it’s easier than ever. Setting up your own entity in each country where you wish to operate can be expensive, complicated, and requires deep knowledge of the specific rules and regulations. Let GlobalPEO take care of everything. From International PEO & EOR, Global Payroll and International Recruiting we deliver our exceptional services at an affordable price.