On June 25, 2024, guideline 02/2024/NV/SBC-LSS-27-V was approved, for the purpose of guiding employers or reporting parties on the correct integration into the Daily Contribution Wage, [in Spanish: Salario Base de Cotización], relating to the line items of food and housing. According to the aforementioned guideline, meal and housing benefits can only be exempted from the Daily Contribution Wage when they are disbursed to the employee in kind.
The Mexican Social Security Institute, [in Spanish: IMSS], has recently observed irregular practices in which employers make cash disbursements or deposits to employee accounts, assigning them as meal or housing benefits without integrating them into the Daily Contribution Wage.
It must be emphasized that the standard deduction of 20% of the Daily Minimum Wage in Mexico City for these line items does not justify the exclusion, as mentioned in Section V of Article 27 of the Social Security Act [in Spanish: Ley del Seguro Social]. This is because the said exclusion only applies when the benefits that are provided are specific items for which the worker makes a payment.
Cash disbursements to workers constitute an economic benefit stemming from an employment relationship, and do not permit a verification of the aforementioned money being actually allocated for food or housing. Therefore, such amounts must be integrated into the Daily Contribution Wage unless they strictly comply with the following established exclusion requirements:
a) Benefits must be disbursed in kind, neither in cash nor through deposits.
b) They must be granted for a valuable consideration as previously set forth.
c) They must be properly registered in the bookkeeping of the employer.
d) They must actually be used for food or for housing purposes.
If these requirements are not complied with, the amounts disbursed as food or housing must be integrated into the Daily Contribution Wage as established by law.
With regard to Social Security, improper tax practices are deemed as such when:
a) Those who were excluded from the Daily Contribution Wage are paid in cash, or when cash is deposited into the account of the employee and registered as food or housing.
b) Those who claim fake deductions in order to demonstrate that meal or housing benefits were for a valuable consideration, when in fact the amounts actually constitute payments made that must be integrated into the Daily Contribution Wage.
c) Those who advise, recommend, provide services, or pay in advance with regard to the previously mentioned practices.
d) A Tax Opinion, that is a "clean and unqualified report”, is issued by an authorized chartered accountant, with respect to Social Security for those employers who engage in any of the conduct referred to herein.
Thank you for your time and attention. We would like to remind you that our team in JA del Río will gladly assist you, as well as offer you options and solutions to help address these provisions.
Please contact us at: contacto@jadelrio.com if you wish to learn more about our services.
