Defining Social Security Contributions

This chapter discusses how to:

Define contribution rates for social security.
Define payback rates for INFONAVIT loans.
Define fixed SDI.
Define variable SDI.

Note. An overview of social security processing in Mexico is described in another chapter in this PeopleBook.

See Also

Defining Contribution Rates for Social Security

To define social security contributions, use the Quotas MEX (GPMX_IMS_QUOTA) component.

This section provides an overview of contribution rates for social security and discusses how to define social security quotas.

Note. In Mexico, “social security quota” is used to refer to social security contributions.

Understanding Contribution Rates for Social Security

Global Payroll for Mexico initially delivers the rates and ceiling days that the system uses to calculate employee and employer contributions to each branch of social security. You must maintain this data when the government issues changes.

To calculate contributions to a branch of social security, the system:

Compares the employee’s integrated daily salary (SDI) amount to the (Minimum Wage * Ceiling Days).
Multiplies the minimum amount by the contribution rate.

Note. Global Payroll for Mexico calculates the SDI factor automatically based on parameters you enter on the Xmas, Vac, Premium, SDI Factor page. Once the system has calculated the SDI factor, it uses the SDI factor to calculate IMSS quotas. The Xmas, Vac, Premium, SDI Factor page is discussed in another chapter in this PeopleBook.

See Defining Earnings.

Example: Calculating the Employer Contribution to RETIRO

Suppose an employee’s integrated daily salary (SDI) amount is 100 MXN, the minimum wage is 45.24, the employer contribution is 0.02, and the day ceiling is 25. The system calculates the employer RETIRO contribution as follows:

Compares SDI (100) to the Minimum Wage * Ceiling Days (45.24 * 25 = 1131.00) and determines that 100 is the smaller amount.
100 * .02 = 2.00 MXN

Now, if the employee’s SDI amount is 1200 MXN, then the Minimum Wage * Ceiling Days (45.24 * 25 = 1131.00) is lower. The RETIRO contribution is 1131.00 * .02 = 22.62 MXN

See Also

Defining General Parameters

Defining Parameters for Christmas Bonuses and Vacation Premiums

Page Used to Define Social Security Quotas

Page Name	Object Name	Navigation	Usage
Social Security Quotas	GPMX_IMS_QUOTA	Set Up HRMS, Product Related, Global Payroll & Absence Mgmt, Social Security/Insurance, Quotas MEX, Social Security Quotas	Define payee and employer contribution rates to social security for each IMSS branch.

Defining Social Security Quotas

Access the Social Security Quotas page.

IMSS Branch

Select the IMSS branch for which you want to define contribution rates.

Payee Percent

Specify the percentage of SDI that the payee contributes.

Employer Percent

Specify the percentage of the employee’s SDI that the employer contributes.

Ceiling Days

Enter the number of days that the system should use to calculate the SDI ceiling for the branch.

Defining Payback Rates for INFONAVIT Loans

To define payback rates for INFONAVIT loans, use the INFONAVIT Loans Percent MEX (GPMX_INF_BR) component.

This section provides an overview of INFONAVIT loans and discusses how to define payback rates.

Understanding INFONAVIT Loans

When employees get a home loan from INFONAVIT, they must pay back a fixed percentage of their pay. This percentage is based on the employee’s integrated daily salary (SDI) as of the first day of the first month. Every two months, the repayment base is updated to reflect any changes to the employee’s SDI.

The bracket element, PR BR INF TASAS, contains the repayment rates for home loans issued by INFONAVIT before January 30, 1998. When the payroll process calculates the pay for an employee with an INFONAVIT loan, it retrieves the correct repayment rate from the bracket, based on the employee’s SDI, and deducts the calculated amount from the employee’s pay. PeopleSoft initially delivers the repayment rates in this table.

The INFONAVIT Loans Percent page provides a convenient way to view and update the repayment rates stored in the bracket element. You can also view and update the same information by accessing the bracket through the Bracket component.

See Defining Bracket Elements.

Page Used to Define Payback Rates for INFONAVIT Loans

Page Name	Object Name	Navigation	Usage
INFONAVIT Loans Percent	GPMX_INF_BR	Set Up HRMS, Product Related, Global Payroll & Absence Mgmt, Loans, INFONAVIT Loans Percent MEX, INFONAVIT Loans Percent	Define the contributions of loan repayment based on SDI. The most common contributions are 20 percent, 25 percent, and 30 percent. This is the amount that an employer can withdraw from an employee’s SDI.

Defining Payback Rates

Access the INFONAVIT Loans Percent page.

PR VR NUM SAL MIN

Displays the factor that represents how much an employee’s SDI exceeds the minimum wage for the employee’s wage zone at the beginning of each two month period. This factor determines which repayment rate applies.

For example, if a payee’s SDI is 200 and the minimum wage for the employee’s wage zone is 45.24, the system calculates a factor of 200 /45.24 = 4.42. According to the sample page, if the factor is from 3.51 to 4.50, the rates in row 3 apply.

Minimum wage amounts are defined on the Minimum Wages page.

See Defining Minimum Wages.

PR VR INF 20 PCT, PR VR INF 25 PCT, PR VR INF 30 PCT

Displays the percentage of the payee’s SDI used to determine how much will be deducted each pay period to repay the loan.

For example, assume that an INFONAVIT loan was originally issued with a repayment base of 20 percent of SDI and that the payee earns three times the minimum wage. According to the sample page, the rates on row 2 apply. In this case, the employee is responsible for paying an amount based on 16.8 percent of his SDI.

Defining Fixed SDI

To define parameters for the fixed SDI process, use the Pay Groups MEX (GPMX_PARM_PYGRP) component.

This section provides an overview of the fixed SDI process and discusses how to define fixed SDI.

Understanding the Fixed SDI Process

There are some minimum elements established by law that must contribute to fixed SDI. However, you can also select additional elements that contribute to fixed SDI. Examples of additional elements include those that are related to job data events, such as hiring and salary changes.

To define and run the fixed SDI process:

Select additional elements that contribute to fixed SDI and define the integration parameters for these elements on the Fixed SDI page.
When a new job data event occurs (hiring or salary changes, for example), a new payee SDI data row will be inserted automatically updating the payee fixed SDI data.

It's also possible to run the fixed SDI calculation due to a minimum salary change or anniversary by running the mass SDI data update. For mass SDI updates, run the fixed SDI process on the SDI by Anniversary and SMG page.

See Running the SDI Batch Processes.

See Running Social Security Reports.

Page Used to Define Fixed SDI

Page Name	Object Name	Navigation	Usage
Fixed SDI	GPMX_FIXSDI_PARM	Set Up HRMS, Product Related, Global Payroll & Absence Mgmt, Framework, Organizational, Pay Groups MEX, Fixed SDI	Select the elements that contribute to fixed SDI and how they integrate for the fixed SDI calculation.

Defining Fixed SDI

Access the Fixed SDI page: Calculation Base tab.

Element Name

Select the earnings element other than the legal minimum (Christmas Bonus and Vacation Premium), that contributes to fixed SDI.

Type

Define whether this element will be applied by individual payee or in general to the entire pay group. Values are By Payee or General.

Calc Base (calculation base)

Select the calculation base for the element. Values are Amount, Daily Rate, Days, Min Wage, and SDI.

Amount

Indicate the value for the flat amount of the element.

%

This field appears when you select Daily Rate for the Calc Base. Enter the percentage of the SDI or daily rate that will be part of the Fixed SDI value.

Fixed SDI Page: Integrable Base Tab

Access the Fixed SDI page: Integrable Base tab.

Integrable Base

Select the integrable base for the element. Each element integrable base can be based on the whole base or a certain percentage of the daily rate, minimum wage, or SDI. Values are All, Daily Rate, Min Wage, and SDI. Depending on the integrable base selected, some of the following fields will appear or not, and should be filled out accordingly.

Lower Limit % (lower limit percentage)

Indicate the lower limit percentage of integration for the element.

Wage Zone

Select the wage zone for the lower limit percentage. Values are A Zone, B Zone, C Zone, and Payee Zone.

Upper Limit % (upper limit percentage)

Indicate the upper limit percentage of integration for the element.

Wage Zone

Select the wage zone for the upper limit. Values are A Zone, B Zone, C Zone, and Payee Zone.

Defining Variable SDI

To define parameters for the Variable SDI process, use the Pay Groups MEX (GPMX_PARM_PYGRP) component.

This section provides an overview of the variable SDI process and discusses how to define variable SDI.

Understanding the Variable SDI Process

With tax reforms effective December 20, 2001, the Variable SDI process is now run bimonthly instead of monthly. In order to accommodate this legislative change, you will:

Indicate the method for calculating the variable SDI on the Base Days for Variable SDI field on the General Parameters page.

Choices are 60 Days, Bimonth Days, Hourly Payee, or Paid Days.
Define variable SDI parameters for a pay group on the Variable SDI page.
Run the Variable SDI process on the Calculate Absence and Payroll page.

You must create a bimonthly calendar and execute the CALC SDI VARIAB process list.

See Also

Defining General Parameters

Running the SDI Batch Processes

Running Social Security Reports

Page Used to Define Variable SDI

Page Name	Object Name	Navigation	Usage
Variable SDI	GPMX_VAR_SDI_PARM	Set Up HRMS, Product Related, Global Payroll & Absence Mgmt, Framework, Organizational, Pay Groups MEX, Variable SDI	Select the earnings, accumulators, and formulas used in the Variable SDI process for a pay group.

Defining Variable SDI

Access the Variable SDI page.

Earnings

Select the earnings that will be used in the Variable SDI process.

Accumulator Name

Select the accumulators that correspond to the earnings for the Variable SDI process.

Element Name

Select one of the three formulas (integration methods) available: IM FM 100% VAR, IM FM TOP VAL IMSS, or IM FM PREMIO INT.

See Also

Modifying the Variable SDI Process

IMSS Branch	Select the IMSS branch for which you want to define contribution rates.
Payee Percent	Specify the percentage of SDI that the payee contributes.
Employer Percent	Specify the percentage of the employee’s SDI that the employer contributes.
Ceiling Days	Enter the number of days that the system should use to calculate the SDI ceiling for the branch.

Element Name	Select the earnings element other than the legal minimum (Christmas Bonus and Vacation Premium), that contributes to fixed SDI.
Type	Define whether this element will be applied by individual payee or in general to the entire pay group. Values are By Payee or General.
Calc Base (calculation base)	Select the calculation base for the element. Values are Amount, Daily Rate, Days, Min Wage, and SDI.
Amount	Indicate the value for the flat amount of the element.
%	This field appears when you select Daily Rate for the Calc Base. Enter the percentage of the SDI or daily rate that will be part of the Fixed SDI value.

Integrable Base	Select the integrable base for the element. Each element integrable base can be based on the whole base or a certain percentage of the daily rate, minimum wage, or SDI. Values are All, Daily Rate, Min Wage, and SDI. Depending on the integrable base selected, some of the following fields will appear or not, and should be filled out accordingly.
Lower Limit % (lower limit percentage)	Indicate the lower limit percentage of integration for the element.
Wage Zone	Select the wage zone for the lower limit percentage. Values are A Zone, B Zone, C Zone, and Payee Zone.
Upper Limit % (upper limit percentage)	Indicate the upper limit percentage of integration for the element.
Wage Zone	Select the wage zone for the upper limit. Values are A Zone, B Zone, C Zone, and Payee Zone.

Earnings	Select the earnings that will be used in the Variable SDI process.
Accumulator Name	Select the accumulators that correspond to the earnings for the Variable SDI process.
Element Name	Select one of the three formulas (integration methods) available: IM FM 100% VAR, IM FM TOP VAL IMSS, or IM FM PREMIO INT.