Profit Sharing in Mexico (PTU)
PTU exemptions, distribution, eligible / non-eligible employees, PTU payment date deadline
Employee Profit Sharing in Mexico (PTU), or "Participación de los Trabajadores en las Utilidades," is a constitutional right for employees to receive a portion of their employer's taxable profits.
Companies legally required to pay PTU must distribute 10% of their annual net taxable income. The net taxable income determined from the company's annual Income Tax Return filed with the Mexican Tax Administration Service (SAT).
Exemptions:
New companies are exempt during their first year of operation
Non-profit organizations and government institutions are exempt due to their non-commercial nature.
Calculation & Distribution
The total PTU amount (10% of net taxable income) is divided into two equal parts:
50% Equal Distribution: This is distributed equally among all eligible employees, regardless of their salary. The distribution is based on the number of days each employee worked during the fiscal year.
50% Proportional Distribution: The remaining 50% is distributed based on the employee's wages during the year. In other words, employees with higher salaries will receive a larger share from this portion.
Eligible Employees
All current employees who worked at least 60 days during the year
All former employees who worked at least 60 days during the year
Non-eligible Employees
Professionals who provide services and invoice for their services with no subordinate work relationship
Employees that worked less than 60 days in during the year
Directors, administrators, general managers, partners or shareholders
PTU Payment Deadline
The Profit sharing payment must be made within the first 60 days after the date of the company's annual tax return
There could be fines, penalties, and legal actions against the company for non-compliance of calculation and payment of PTU in Mexico
Human Resources Mexico has been paying PTU to all employees for 15 plus years. WE DO NOT INVOICE our clients for the PTU payments. Our clients pay absolutely nothing. This is why foreign companies that do not have a legal entity in Mexico, choose HRM as their most trusted PEO in Mexico. 16 plus years hiring in Mexico with full compliance. 100% human support for our client companies and our client employees. No one else has this philosophy.
