Balance Initialization Scenarios for Mexico

Depending on the go-live date, you need to initialize specific balances, to avoid inaccurate results in payroll calculations.

Go-live Mid-month

COMPONENT	SUB-COMPONENT	DESCRIPTION	BALANCES TO INITIALIZE	DIMENSIONS
ISR Tax for Regular	Subsidy for Employment	ISR Subsidy for Employment is adjusted automatically every pay period to ensure that the monthly cap is not exceeded.	Earnings for ISR ISR NonWorking Days ISR Subject ISR Subsidy for Employment ISR Subsidy for Employment Paid ISR Subsidy For Employment Paid Regular	Relationship Tax Unit Month to Date Relationship Tax Unit Period to Date
Monthly Tax Adjustment	N/A	The Monthly Tax Adjustment Payroll Run Type: Prorates monthly rates based on the pay period it isused. Computes the tax for the accumulated ISR subject earnings earned in the current period andall previous periods in the month. Adjusts the ISR Withheldbalance Withholds/reimburses the difference in the payroll run	Fixed Earnings ISR Calculated ISR NonWorking Days ISR Subject ISR Subsidy for Employment ISR Subsidy for Employment Paid ISR Tax to Charge ISR Withheld	Relationship Tax Unit Month to Date Relationship Tax Unit Period to Date
ISR Tax for Non-Periodic ISR Tax for Severance	Monthly Ordinary Salary	The ISR Tax calculation methods for Severance and Non-periodic earnings are dependent on the employee's monthly salary.	Fixed Earnings Eligible Days for Fixed Earnings	Relationship Tax Unit Month to Date Relationship Tax Unit Period to Date

Go-live Mid-year

COMPONENT	SUB-COMPONENT	DESCRIPTION	BALANCES TO INITIALIZE	DIMENSIONS
Social Foresight Earnings taxability rule	N/A	The Social Foresight Taxability rule is computed based on the total annual employee income and the Social Foresight earnings.	Gross Earnings Social Foresight Earnings	Relationship Tax Unit Year to Date
Profit sharing	N/A	The current Fiscal Year (FY) profit sharing is processed and paid every May of the next FY. (For example, FY 2022 profit sharing is paid in May 2023). In order to determine the average of the employee’s profit sharing participation received in the last three years, the Mexico Profit Sharing statutory balance needs to be initialized for each of the employee’s previous 3 payments.	Mexico Profit Sharing statutory balance Eligible Compensation for Profit Sharing Eligible Worked Days for Profit Sharing	Relationship NoCB Year to Date

Go-live Beginning of Bi-month

COMPONENT	SUB-COMPONENT	DESCRIPTION	BALANCES TO INITIALIZE	DIMENSIONS
SDI Variable Portion	N/A	The current bi-month SDI variable portion is derived from the variable compensation earned in the previous bi-month on a daily basis.	Variable Earnings Days Basis of Quotation 1	Relationship Tax 2 Months to Date

Go-live Middle of Bi-month

COMPONENT	SUB-COMPONENT	DESCRIPTION	BALANCES TO INITIALIZE	DIMENSIONS
SDI Variable Portion	N/A	In addition to the previous bi-month balance that is needed to compute the current bi-month variable portion, it will be necessary to initialize the balance with the pay-period values of the current bi-month to be able to compute next bi-month SDI value.	Gross Earnings Social Foresight Earnings	Relationship Tax 2 Months to Date Relationship Tax Unit Month to Date Relationship Tax Unit Period to Date
Employer State Tax Oaxaca State	Taxability rules	Oaxaca (OAX) state has an exemption tax rule 'The exemption will be up to one Employee Minimum Wage elevated to the current Bi- Month', applicable for some secondary classifications.	Glasses Assistance Educational Assistance Scholarship for Children of Workers Scholarship for Workers Healthcare Reimbursement Social Foresight Earnings	Relationship Tax Unit, Area1 Period to Date Relationship Tax Unit, Area1 Run Relationship Tax Unit, Area1 Year to Date