INFONAVIT is Mexico’s National Housing Fund Institute. For any foreign company establishing operations in Mexico, navigating the landscape of mandatory employee benefits is a critical task. Beyond salaries and social security, one of the most significant and unique obligations is contributing to the Instituto del Fondo Nacional de la Vivienda para los Trabajadores (INFONAVIT), or the National Workers’ Housing Fund Institute. This federal entity is a cornerstone of social welfare in Mexico. It has a powerful mandate to provide affordable housing solutions for the nation’s workforce.
Understanding INFONAVIT is not just a matter of human resources. It is also a fundamental aspect of legal and fiscal compliance. The institute requires every employer in Mexico to register. This is regardless of size or industry. It also requires employers to make regular contributions on behalf of their employees. Misunderstanding these obligations can result in significant financial penalties, legal complications, and difficulties in attracting and retaining top talent.
This guide provides a comprehensive overview of INFONAVIT, designed specifically for business owners, general managers, and HR directors operating in Mexico. We will explore the institute’s core mission, detail the specific legal obligations for employers, break down the mechanics of contribution and loan repayment, and explain the importance of maintaining compliance. Ultimately, this document will provide the clarity necessary to manage your INFONAVIT responsibilities effectively and ensure your operation is built on a solid foundation of legal compliance.
Mexico’s National Housing Fund Institute
Instituto del Fondo Nacional de la Vivienda para los Trabajadores
The Mexican Institute of the National Housing Fund for Workers is the federal institute for worker’s housing. It is the largest mortgage lender in Latin America and the fourth worldwide
| Founded | 1972 |
|---|---|
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General Director |
Octavio Romero Oropeza |
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Assets |
MXN 86 956 Mn (2020) |
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Website |
https://portalmx.infonavit.org.mx |
Established in 1972, INFONAVIT is a tripartite institution, meaning it is managed jointly by representatives from three sectors: the government, employers, and employees (labor unions). Its primary and foundational mission is to administer a national housing fund that allows Mexican workers to obtain affordable credit to purchase, build, remodel, or pay off a mortgage for a home.
To achieve this, INFONAVIT functions in two primary capacities:
A Social Savings Fund: INFONAVIT operates a massive savings system where every employee has an individual housing sub-account (Subcuenta de Vivienda). Employers make mandatory contributions directly into this account for each of their employees. This fund grows over the employee’s working life and serves as a down payment or collateral for a future housing loan. If an employee never uses their housing credit, the accumulated funds are returned to them upon retirement as a supplement to their pension.
A Mortgage Originator: INFONAVIT is one of the largest mortgage lenders in Latin America. It uses the collective capital from employer contributions to grant housing loans directly to eligible workers. The institute typically offers these loans at competitive interest rates. Also, INFONAVIT designs them to be accessible to a wide range of income levels.
In essence, INFONAVIT creates a virtuous cycle: employers’ contributions fund the system, which in turn provides the capital for the very loans that their employees will use to achieve homeownership. For the employer, it is a mandatory social contribution; for the employee, it is a fundamental social benefit.
For any company with employees in Mexico, compliance with INFONAVIT regulations is a legal mandate from the moment the first employee is hired. The obligations are clear, and the enforcement is rigorous.
Employee Registration: You must register every single one of your employees with INFONAVIT, providing their salary and personal information. You must do this within five working days of the hire date.
Making Bimonthly Contributions: The cornerstone of the system is the employer’s financial contribution. You are required to pay 5% of each employee’s integrated base salary (Salario Base de Cotización) directly to INFONAVIT. Companies make these payments on a bimonthly basis.
Withholding and Remitting Loan Payments: If an employee has an active INFONAVIT mortgage, the employer takes on the role of a collection agent. INFONAVIT will formally notify you that an employee has a loan, and you are then legally obligated to withhold the specified loan repayment amount from the employee’s payroll and remit it to INFONAVIT along with your bimonthly contributions.
Accurate Reporting and Record Keeping: Employers must maintain precise records of all contributions and deductions and submit regular reports to the institute. Any changes to an employee’s salary, status, or a new hire or termination must be reported promptly.
Failure to meet any of these obligations can result in significant penalties. The system is not optional; it is a fundamental part of the legal framework for employment in Mexico.
The most critical function for an employer is the correct calculation and payment of the mandatory 5% contribution. Understanding how to calculate it is essential for accurate financial planning and compliance.
The contribution is not calculated based on an employee’s nominal salary. Instead, it is based on their Base Listed Salary (SBC). The SBC is the employee’s daily wage plus a proportional amount for all other cash benefits they receive, such as their Christmas bonus (aguinaldo), vacation premium, and any other regular bonuses or commissions. This integrated salary is the same figure companies use for calculating IMSS contributions.
The formula is straightforward: Employee’s SBC x 5% = Employer’s INFONAVIT Contribution
This amount is paid entirely by the employer; it is not a deduction from the employee’s wages. It is a direct cost to the company, representing a significant component of the total cost of labor in Mexico.
Companies pay these contributions on a bimonthly basis, according to a specific schedule established by the government. The payment process is typically integrated with the IMSS payment system through a unified platform called SUA (Sistema Único de Autodeterminación). This system allows companies to calculate and pay both their IMSS and INFONAVIT contributions in a single process, streamlining the administrative burden.
While the employer funds the system, the benefits are directed entirely to the employee. After a certain period of continuous contributions, an employee becomes eligible to apply for an INFONAVIT mortgage credit.
Aviso de Retención (Withholding Notice). From that point forward, the employer is legally obligated to:
Withhold the specified loan repayment amount from the employee’s regular payroll. INFONAVIT determines this amount and can be a fixed amount, a percentage of their salary, or based on a specific calculation.
Remit these withheld funds to INFONAVIT along with the bimonthly 5% employer contributions.
This is a critical responsibility. If an employer fails to withhold and remit these payments, the employer, not the employee, can be held directly liable for the missed loan payments. For this reason, it is essential for a company’s HR and payroll departments to have a robust system for tracking these notifications and managing deductions accurately.
INFONAVIT, like the SAT and IMSS, has significant legal authority to audit employers to ensure compliance. An INFONAVIT audit is a serious matter and can be triggered for various reasons, including random selection, late payments, or discrepancies in reporting.
During an audit, an inspector will typically review:
Payroll Records: To verify that contributions and deductions are being calculated correctly based on the proper SBC.
Proof of Payment: Evidence that all bimonthly contributions and withheld loan payments have been remitted on time and in full.
Hiring and Termination Records: To ensure that all employees have been correctly registered and that their status changes have been reported promptly.
Consequences of Non-Compliance: The penalties for failing to comply with INFONAVIT regulations can be severe.
Fines and Surcharges: Late payments are subject to automatic inflation adjustments, surcharges, and significant fines.
Direct Liability: As mentioned, if an employer fails to make the required deductions for an employee’s mortgage, the employer can be forced to pay those amounts themselves.
Legal Action: In cases of significant or willful non-compliance, INFONAVIT has the authority to take legal action, including freezing company bank accounts or placing liens on assets to collect outstanding debts.
Given these risks, maintaining meticulous records and ensuring timely, accurate payments is not just good practice; it is an essential risk management function.
INFONAVIT is a unique and powerful institution that plays a central role in the social and economic fabric of Mexico. For employees, it represents the primary pathway to homeownership and a secure retirement asset. For employers, it represents a fundamental legal and social responsibility.
Navigating the complexities of the INFONAVIT system is not easy. From correctly calculating the 5% contribution based on the integrated salary to managing the administrative burden of loan repayment withholdings, it requires dedicated expertise and a serious commitment to compliance. The financial and legal risks of getting it wrong are simply too significant to ignore.
At Start-Ops, we specialize in helping companies manage these complex obligations. We provide the expert guidance and administrative support necessary to ensure your operation is fully compliant with all INFONAVIT regulations from day one. We manage the administrative burden of these mandatory social contributions so you can focus on what you do best: growing your business and supporting your team.
Contact us for a strategic consultation to explore how we can help you build a compliant and successful operation in Mexico.