On June 8, 2023, the Resolution ACD.AS2.HCT.300523/128.P.DIR., issued by the Technical Council of the Mexican Institute of Social Security in a session held on May 30, 2023, was published in the Federal Official Gazette (the Resolution). In the Resolution, the exclusion of the concept of contributions to pension plan funds, in the integration of the contribution base salary, was approved as a criterion. The foregoing, in order to guide employers or obligated subjects.

The reference criterion establishes that the amounts delivered in cash or in kind to workers or deposited in their personal or payroll accounts for contributions to pension funds or plans, do not make up the contribution base salary in accordance with the Social Security Law (the Law).

Therefore, in accordance with the Law, the electronic registry pension plans shall have the purpose of complementing the retirement income of the people who maintain a working relationship with the entity that finances said pension plan, granting them a retirement to the time they definitively separate from said entity, after having worked for several years in it.

Likewise, the Law establishes that in order to be able to exclude contributions to electronically registered pensions as part of the base contribution salary of workers, the following requirements shall be met as a minimum: (i) that the benefits are granted in a general manner; (ii) that the sums of money earmarked for electronically registered pension plans are duly registered in the employer’s accounting; (iii) that the sums of money allocated to the fund are paid directly by the employer; and (iv) that the employer or whoever he hires as Administrator of the electronic pension plan, does not provide the workers with any direct benefits, either in kind or in money charged to the fund during the time said workers provide their services for the company, nor for those who do not meet the retirement requirements established in the electronic pension plans themselves.

Derived from the foregoing, it is considered that an improper tax practice is carried out in the field of social security, to those who give their workers amounts in cash, via payroll or by any means, pretending that it is for social purposes, as a concept of pension plans, subsistence pension, survivor’s pension, retirement, life annuity, pension or social security fund, regardless of the denomination determined, in order to exclude them as part of the contribution base salary to avoid the payment of social security contributions.

Finally, it is important to take into account what is established in the Resolution and carefully review the conditions under which companies are operating, since carrying out improper tax practices is considered a crime that is punishable by up to 13 years in jail.

At Trejo Gutiérrez Abogados, we have a group of experts in labor matters with more than 20 years in the market. In case you require additional information or a legal analysis, please do not hesitate to contact us. We will be glad to provide the personalized legal advice that you require.