Short answer: in fully registered employment, budget about 40% on top of gross salary for statutory costs in Mexico. The largest items are social security, the housing fund, state payroll tax and the year-end bonus.
What you pay on top of salary
An employee in Mexico costs more than the salary on the offer letter. The law adds social security, a housing fund contribution, a state payroll tax and several mandatory benefits.
| Cost | Basis |
|---|---|
| Year-end bonus (Aguinaldo) | At least 15 days of salary per year |
| Vacation premium (Prima vacacional) | At least 25% of vacation pay |
| Social security (IMSS) | Employer contributions set by law on the insured salary |
| Housing fund (INFONAVIT) | 5% of the insured salary |
| State payroll tax (Impuesto Sobre Nómina, ISN) | A rate set by each state |
| Profit sharing (PTU) | 10% of taxable profit, subject to legal caps |
Where the 40% comes from
Across the teams we run, fully registered employment adds on average about 40% to gross salary once every statutory item is included. The exact figure depends on the salary level, the state and the benefits package.
Costs people forget
Remote employees are entitled to support for the costs of working from home under the telework standard (NOM-037), such as a share of internet and electricity. Final settlements when someone leaves are also a real cost that belongs in the budget from day one.
How an Employer of Record changes the math
With an Employer of Record, statutory costs do not disappear, but you stop paying for the structure around them: no entity, no local payroll team, no separate legal counsel. At Thriver those costs pass through at cost and our fee is one flat amount per employee. Estimate your cost.