Mexico Tax Calculator 2025: Complete Guide to Mexican Income Tax & IMSS

Mexico's tax system features progressive income tax rates (ISR), comprehensive social security (IMSS), and various deductions. This comprehensive guide will help you understand and calculate your tax liability in Mexico for 2025.

Mexico Tax System Overview

Key Components

ISR (Impuesto Sobre la Renta): Personal income tax with progressive rates from 1.92% to 35%
IMSS (Instituto Mexicano del Seguro Social): Social security contributions (~3% employee share)
Deductions: Various personal, medical, and education deductions
Tax Credits: Dependent credits and other reliefs
Monthly Filing: Employees have tax withheld monthly

Who is Tax Resident?

Mexican residents: Taxed on worldwide income
Non-residents: Taxed on Mexican-source income only
Resident for tax purposes: Present in Mexico for 183+ days in a 12-month period or have a permanent home in Mexico

ISR Tax Brackets 2025

Progressive Tax Rates

| Annual Income (MXN) | Tax Rate |

|---------------------|----------|

| Up to MXN 7,735 | 1.92% |

| MXN 7,736 - MXN 65,651 | 6.4% |

| MXN 65,652 - MXN 115,375 | 10.88% |

| MXN 115,376 - MXN 134,119 | 16% |

| MXN 134,120 - MXN 160,577 | 17.92% |

| MXN 160,578 - MXN 323,862 | 21.36% |

| MXN 323,863 - MXN 510,451 | 23.52% |

| MXN 510,452 - MXN 974,535 | 30% |

| MXN 974,536 - MXN 1,299,380 | 32% |

| Over MXN 1,299,380 | 35% |

Example Calculation

Annual income: MXN 300,000

MXN 0 - MXN 7,735: MXN 149 (1.92%)
MXN 7,736 - MXN 65,651: MXN 3,707 (6.4%)
MXN 65,652 - MXN 115,375: MXN 5,410 (10.88%)
MXN 115,376 - MXN 134,119: MXN 2,999 (16%)
MXN 134,120 - MXN 160,577: MXN 4,736 (17.92%)
MXN 160,578 - MXN 300,000: MXN 29,755 (21.36%)
Total ISR: MXN 46,756

IMSS (Social Security) Contributions

IMSS Rates 2025

Employee contribution: ~3% of salary
Employer contribution: ~25-30% of salary
Covers: Health insurance, retirement, disability, maternity, work injury

IMSS Calculation Example

Monthly income: MXN 25,000

Employee IMSS: MXN 25,000 × 3% = MXN 750
Annual IMSS: MXN 9,000

IMSS Benefits

Medical services (public healthcare)
Disability benefits
Maternity benefits
Retirement pension
Work injury compensation
Unemployment benefits

Tax Deductions and Credits

Standard Deductions

Personal exemption: MXN 151,140 per year (2025)
Medical expenses: Up to 15% of gross income
Education expenses: Up to MXN 29,200 per dependent
Mortgage interest: Up to MXN 750,000 per year
Retirement contributions: Up to 10% of gross income (AFORE)

Other Deductible Expenses

Donations to approved charities (up to 7% of gross income)
Medical insurance premiums
Funeral expenses
Disability expenses

Tax Credits

Dependent credit: MXN 1,200 per dependent per year
Elderly credit: MXN 1,200 (over 65)
Disability credit: MXN 1,200

Total Tax Burden Example

Single Person Earning MXN 300,000

ISR: MXN 46,756
IMSS: MXN 9,000
Total tax: MXN 55,756
Net income: MXN 244,244
Effective rate: 18.6%

Married Couple with 2 Children Earning MXN 500,000

Personal exemption: MXN 151,140
Dependent credits: MXN 2,400 (2 children)
Taxable income: MXN 348,860
ISR: MXN 78,234
IMSS: MXN 15,000
Total tax: MXN 93,234
Net income: MXN 406,766
Effective rate: 18.6%

Self-Employed Tax

Régimen de Incorporación Fiscal (RIF)

Simplified tax regime for small businesses
Gradual tax rates (0% to 100% over 10 years)
Annual income limit: MXN 3.5 million
No IMSS required (can opt-in)

Regular Self-Employed

ISR: Same progressive rates as employees
IMSS: Voluntary enrollment available
Must file monthly (if income > MXN 300,000)
IVA (VAT): 16% on services (if applicable)

Tax Planning Strategies

1. Maximize Deductions

Claim all dependents
Medical and education expenses
Mortgage interest deductions
Retirement contributions (AFORE)

2. Use Tax-Advantaged Accounts

AFORE contributions (up to 10% of income)
Tax-deferred growth
Employer matching available

3. Medical Expenses

Up to 15% of gross income deductible
Includes insurance premiums
Keep all receipts

4. Education Expenses

Up to MXN 29,200 per dependent
School fees, books, materials
University tuition included

Common Deductions

Medical Expenses

Medical consultations
Prescription drugs
Dental care
Health insurance premiums
Up to 15% of gross income

Education Expenses

School fees
University tuition
Books and materials
Up to MXN 29,200 per dependent

Housing Expenses

Mortgage interest (up to MXN 750,000)
Property taxes
Home improvements (limited)

Tax Deadlines

Key Dates

Monthly: Tax withholding for employees
April 30: Annual tax return due
Monthly: IMSS contributions
Quarterly: Estimated tax payments (self-employed)

Late Filing Penalties

Minimum: MXN 1,000
Maximum: 40% of tax due
Interest: 1.47% per month

Using Our Mexico Tax Calculator

Our calculator provides:

Accurate 2025 ISR calculations
IMSS contribution estimates
Deduction applications
Net income after all taxes
Effective tax rate
Dependent credit calculations

Input required:

Annual income
Marital status
Number of dependents
Medical/education expenses
Mortgage interest
Retirement contributions

High Earners

Additional Considerations

Higher marginal rates (up to 35%)
Wealth tax considerations
International tax planning
Investment optimization

Exit Tax

Tax on leaving Mexico
Deemed disposal rules
Consider timing of departure

Non-Resident Tax

Mexican-Source Income

Employment in Mexico
Rental income from Mexican property
Dividends from Mexican companies
Subject to Mexican tax

Tax Treaties

Mexico has treaties with many countries
Prevents double taxation
May reduce withholding taxes

Common Mistakes to Avoid

1. Not Claiming Dependents

MXN 1,200 per dependent
Significant tax savings
Include all eligible dependents

2. Missing Deductions

Medical expenses up to 15%
Education expenses
Mortgage interest
Retirement contributions

3. IMSS Calculation Errors

Employee share is ~3%
Employer pays majority
Different rates for different income levels

4. Late Filing

April 30 deadline
Significant penalties
Interest charges

Getting Professional Help

When to Consult a Tax Advisor

Complex situations:

Multiple income sources
Self-employment
International tax issues
High net worth individuals

Life events:

Marriage or divorce
Having children
Buying property
Starting a business

Finding Qualified Advisors

Look for:

Contador Público (CP)
SAT-registered tax advisors
International tax specialists
Mexican tax law experts

Conclusion

Mexico's tax system combines progressive income tax with comprehensive social security. Understanding ISR rates, IMSS contributions, and available deductions is essential for accurate tax planning.

With progressive rates from 1.92% to 35% and IMSS at ~3%, your total tax burden can be manageable with proper planning. The generous deductions for medical expenses, education, and mortgage interest can significantly reduce your liability.

Use Our Free Mexico Tax Calculator →

Get an accurate estimate of your tax liability and net income. For complex situations, especially involving self-employment or international tax matters, consult with a qualified contador público.

Disclaimer: This guide provides general information only. Mexican tax law changes regularly, and individual circumstances vary. Always consult with a qualified tax professional for advice specific to your situation.