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The income tax withholding table defines the income brackets used to calculate each employee’s withholding in payroll.

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How it is applied

For each employee, payroll takes the taxable income (after social security deductions), finds the corresponding bracket, and calculates:
The table whose frequency matches the payroll period is used:
If income tax tables exist but the one for the payroll’s frequency is missing, the payroll is not generated. Register the tables for every frequency you pay on.

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Register a bracket

1

Go to Human Resources → Tax Tables → New Bracket

2

Select the Frequency (Monthly, Biweekly, or Weekly) and a name (e.g. Bracket II)

3

Enter the bracket values

4

Save

Repeat the process for each bracket (exempt, II, III, IV) and for each frequency.
Keep the tables up to date according to the current provisions of the Ministry of Finance (Hacienda). An outdated table produces incorrect withholdings.