Mexico: Extension of time, outsourcing personnel rules

An extension of the labor outsourcing rules

An extension of the labor outsourcing rules

A decree regarding an extension of the labor outsourcing rules was published in the official gazette on 31 July 2021.

The decree reflects the compliance deadline is extended through 1 September 2021, in an effort to give companies more time to complete the necessary procedures to regularize their templates and to register their services and personnel outsourcing.

An April 2021 decree set forth transitory compliance rules with respect to determining different periods for tax, labor, and social security purposes, with the relevant period being 90 days from the effective date of the decree. Read TaxNewsFlash

To provide more time for affected companies to comply with the new provisions on subcontracting, it was considered appropriate to extend the deadlines by one month (from 1 August 2021 to 1 September 2021).

Under the decree, there are requirements to register with the Ministry of Labor and Social Welfare (STPS) for specialized services or works as well as rules for recognizing the labor rights and seniority of workers. In addition, employers are to provide information regarding specialized services every four months (but no later than the 17th day of January, May, and September) for the purposes of the social security law.

For income tax and value added tax (VAT) purposes, the requirement regarding information for the deductibility of expenses for tax credit purposes will be effective as of 1 September 2021.

Read an August 2021 report (Spanish) prepared by the KPMG member firm in Mexico


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