On December 30, 2016, the decree was published in the Official Gazette of the State of Nuevo León, which includes, among other articles of the Tax Law of the State of Nuevo León, those related to the obligations of the Taxpayers On Payroll (ISN), which came into force on January 2, 2017.


The most significant change in relation to this tax concerns companies that contract the provision of services of taxpayers domiciled within the territory of the State or in another Federative Entity.


Accordingly, companies that contract personnel services through a third party since January 2017 have the obligation to withhold and pay the payroll tax for the contracted services as if they were their own employees.


Companies that are obliged to withhold tax, as referred to in previous paragraphs, must request their registration in the State Taxpayers Registry as withholding of the Payroll Tax and issue records of withholding of the Payroll Tax in the format approved by the authorities.


It is important to mention that the providers of personnel services must inform the company that receives the personnel service on a monthly basis, the amount of the payroll and corresponding tax of the subcontracted persons that must be withheld.


When determining the withholding of the Payroll Tax, the amount of personal work payments made by the contracted taxpayer is not known, the withholding shall be determined by applying the 3% rate to the total value of the consideration actually paid for the services contracted in the corresponding month, not including the Value Added Tax.


The withholding of the tax provided for in the previous paragraph does not exempt the taxpayers that render the service from the obligation to present the declaration of payment of the respective tax, and in which the tax that has been withheld in the corresponding period may be credited. If applicable, the difference in the Payroll Tax resulting from your charge must be paid, or request a refund of the corresponding tax, in the event that such withholding generates a balance in favor.


On April 5, 2017, the issuance of administrative facilities was published in the Official Gazette of the State of Nuevo León to benefit those companies required to effect withholding; this benefit is not to withhold the ISN for all the months corresponding to 2017.