If you are looking for your first job or just got your first opportunity then it is important that you know the difference between gross and net salary. This will not only allow you to compare options and choose the best one, but also to know the taxes and contributions that are discounted from the total amount you earn.
What is net salary?
According to the Federal Labor Law, the wage or salary is the economic compensation that the employer must pay the worker for his work. This can be set per unit of time, per unit of work, per commission, at a fixed price or in any other way.
Regarding the amount that the worker receives, there are some factors that intervene, for example, it is not the same to talk about net and gross salary. The first refers to the monetary amount that the worker receives, that is, the money that he receives in his account once minus taxes and social security contributions.
To calculate it, the IMSS quotas, ISR withholding, Infonavit Credits, among some others, must be subtracted from the gross salary. This amount depends on the type of employment contract of each worker.
What is gross salary?
While the gross salary is the total amount before those withholdings are applied. This represents the money that a worker receives for the work that he performs in the company, but that is subject to tax withholdings on each payroll that will be deducted, obtaining the net salary as a result.
Therefore, the gross salary is the sum of all the amounts received by a worker, that is, the Base salary plus bonuses such as seniority, overtime, night work, residence, improvements, toxicity, etc.
How to calculate gross salary withholdings?
The deductions that apply to gross salary include both tax payments and payments destined to Social Security such as medical expenses or retirement.
Income Tax (ISR)
As the site explains Factorial, to calculate this deduction you must review the Income Tax (ISR) tables for the current year that are available on the website of the Tax Administration System (SAT). Once there you must continue to do the following:
- Locate the gross monthly salary within the table corresponding to the “lower limit” and “upper limit”.
- Subtract the “lower limit” value from the total income. The result you get will be the base.
- Locate the rate corresponding to the gross salary range in the table.
- Calculate the percentage of the rate to base that you obtained previously.
- Add the fixed fee located in the table to the result.
IMSS fees
The employer worker quotas They are the total sum of the amount that is contributed to the IMSS by workers, employers and the quota that the Mexican government contributes. These quotas make up a patrimony that is destined to the retirement, unemployment and old age of the worker or worker, in addition to guaranteeing their social security and medical attention.
Employer worker contributions are calculated based on the following factors:
- The worker’s base salary (SBC).
- The Measurement and Update Unit (UMA).
- Percentages set within the Social Security Law.
- Insurance and social benefits provided by the IMSS.
Work risk insurance
To obtain the percentage to be paid, the employer takes as a reference the worker’s base contribution salary and the classes of work risk specified in the Regulation of the Social Security Law on affiliation, company classification, collection and inspection:
- Class I: 0.54355 percent.
- Class II: 1.13065 percent.
- Class III: 2.59840 percent.
- Class IV: 4.65325 percent.
- Class V: 7.58875 percent.
Health and maternity insurance
The sickness and maternity insurance provides coverage for medical care, hospital care and benefits in kind.
According to the Factorial site, to carry out the insurance calculation, the employee contribution base salary (SBC) and do the following:
- Obtain the amount of the daily salary and subtract the discount corresponding to the difference of the SBC and three times the UMA which is 0.40 percent.
- Multiply the gross salary by the deduction for medical expenses which corresponds to 0.375 percent.
- Carry out the same process with the percentage corresponding to cash benefits which is 0.25 percent.
- Add up all the results to find out how much you allocate to the IMSS.
Disability and life insurance
This type of insurance is used when the worker suffers an accident due to work and is disabled or dies. Said insurance is covered by both the employer and the collaborator, corresponding to the first 1.75 percent of the SBC and the second 0.625 percent.
Retirement insurance, unemployment in old age and old age
In this case, only the employer is the one who must provide the 2 percent of SBC. While for unemployment at advanced age and old age, the employer must provide the 3,150 percent of the SBCwhile the worker corresponds to the 1.125 percent of his SBC.
Nurseries and social benefits
This insurance grants the insured and their beneficiaries childcare services for their children, that is, it covers the risk of not being able to provide care for their children during the working day.
In this case, the employer must cover the additional 1 percent to the SBC that the worker has
Are taxes and contributions deducted from the minimum wage?
No, the withholding of taxes or contributions does not apply to the minimum salary, the same happens when the net monthly salary is less than the minimum salary.
The minimum wage in the North Border Free Zone It is 312 pesos a dayequivalent to 9 thousand 372 pesos for 30 working days. While in the rest of the country it is 207 pesos dailyequivalent to 6 thousand 223 pesos for 30 days worked.
With information from Leticia Hernández.
