IESS. Décimos. Utilidades. Ecuador payroll, owned.
Ecuadorian payroll is not a configuration exercise. It demands a live IESS contribution engine that handles aporte personal and patronal on the full remuneration, fondos de reserva that switch on after the first year, the SRI income-tax table with the gastos-personales rebaja, two mandatory décimos, and 15% utilidades on annual profit — all dollarized in USD and filed monthly through SRI en línea and IESS Historia Laboral. Most providers deliver two of these. Mercans delivers all of them — on a single proprietary stack with no intermediaries.
native payroll
vs nearest peer
since inception
- Currency
- USD (dollarized since 2000)
- SBU 2026 (minimum wage)
- USD 482 / month
- IESS Aporte Personal
- 9.45% of remuneration (EE)
- IESS Aporte Patronal
- 11.15% of remuneration (ER)
- IECE + SECAP (ER)
- 0.5% + 0.5% = 1.0%
- Fondos de Reserva
- 8.33% after 1 year of service
- Income Tax (IR)
- 0–37% progressive (USD table)
- Fracción Básica Desgravada
- USD 12,208 / year (0%)
- Décimo Tercero
- 1/12 of annual pay · Dec
- Décimo Cuarto
- 1 SBU = USD 482 · Mar/Aug
- Utilidades (profit share)
- 15% of profit · by 15 Apr
- Working Week
- 40 hours · 8h/day
- Annual Leave
- 15 calendar days
- Despido Intempestivo
- Min 3 months · max 25 months
- IESS Planilla
- Monthly · Historia Laboral
Getting Ecuador payroll “mostly right” is the most expensive mistake
Ecuador’s regulators don’t grade on a curve. The IESS cross-checks Historia Laboral against declared remuneration and flags under-affiliation in real time. The SRI reconciles monthly withholding against the annual projection of gastos personales. The Ministerio del Trabajo audits décimos, utilidades, and SUT registrations. None of these failures announce themselves — they accumulate as glosas and recargos until an inspection makes them very visible.
Late or under-affiliation to IESS
Every worker must be affiliated to IESS from day one on the full remuneration. Late affiliation or contributions on understated pay triggers responsabilidad patronal — the employer reimburses the full benefit cost plus recargos, and faces fines and potential criminal liability for non-payment of withheld aportes.
Income-tax withholding vs gastos personales mismatch
Monthly IR withholding must reflect the employee’s February projection of gastos personales and family-basket rebaja. Over- or under-withholding produces glosas at the SRI annual reconciliation, with interest and a 20% recargo on under-declared tax.
Décimos & fondos de reserva miscalculation
Décimo tercero (1/12 of annual remuneration), décimo cuarto (one SBU), and fondos de reserva (8.33% from the 13th month) have fixed legal deadlines. Late or incorrect payment is a Ministerio del Trabajo infraction with fines and accrued interest payable to the worker.
Utilidades distribution errors
15% of pre-tax profit must be distributed to workers by April 15 — 10% by headcount and 5% by family burden. Mis-distribution, late payment, or excluding eligible workers triggers Ministerio del Trabajo sanctions and worker claims with interest.
The three types of providers who struggle with Ecuador
Global Aggregator Platforms
Aggregator platforms operate through a partner network in Ecuador — they don’t own the entity, don’t directly file IESS Historia Laboral, and don’t control the SRI relationship. When a regulation changes, the instruction travels: platform → local partner → your payroll. Each handoff introduces delay and interpretation risk.
- ×No direct IESS Historia Laboral filing — partner intermediary
- ×Fondos de reserva and décimos logic partner-dependent
- ×Utilidades 15% distribution often handled manually
Large Global Payroll Incumbents
Incumbents have Ecuador coverage — in name. Legacy systems struggle when the SBU changes annually, the SRI updates the income-tax table, or gastos-personales rebaja rules shift — leaving hardcoded values and manual workarounds.
- ×Annual SBU and IR-table updates require manual configuration
- ×Gastos-personales rebaja calculation handled off-system
- ×No utilidades distribution engine for 10%/5% split
Local Ecuadorian Firms
Local firms know IESS and the SRI — but they can’t scale with you. No proprietary payroll technology, no HRIS integration, no multi-country consolidation, and no data security certifications multinationals require.
- ×No proprietary payroll technology platform
- ×No data security certifications (SOC 1/2, ISO 27701)
- ×No Latin America consolidation capability
The only provider that closes every gap
Mercans is the only Ecuador payroll provider that combines a proprietary payroll technology stack, full-time in-country compliance teams, direct IESS and SRI relationships, native Historia Laboral and SRI en línea filing, and enterprise-grade data security — simultaneously, on one contract, with no intermediaries.
The only engine built for Ecuador’s actual payroll architecture
G2N Nova™ natively models Ecuador’s IESS contribution system — aporte personal 9.45%, aporte patronal 11.15%, IECE/SECAP 1%, fondos de reserva 8.33% after the first year — alongside the SRI income-tax table with the gastos-personales rebaja, both décimos, and the 15% utilidades distribution, auto-generating Historia Laboral planillas and SRI withholding files on every payroll run.
Full-time Ecuador team — not a partner you phone when things break
Mercans employs full-time payroll and compliance professionals in Ecuador with active relationships with the IESS, the SRI, and the Ministerio del Trabajo. When the SBU is fixed each December, the SRI updates the income-tax table, or rebaja rules change, our engine is updated and your team is briefed before it reaches your inbox.
The security posture multinationals require — and Ecuador’s LOPDP mandates
Ecuador’s Ley Orgánica de Protección de Datos Personales (LOPDP) requires payroll processors handling cédulas, IESS records, and salary data to maintain documented privacy controls. Mercans holds BCR approval, ISO 27701, SOC 1 & 2, and ISO 27017/27018 — the complete certification stack Ecuador’s data protection law requires. Zero breaches since inception.
Where Mercans wins on every Ecuador-specific capability
Each row is an Ecuador-specific payroll capability. Full = native in-platform, half = partial/manual workaround, empty = gap.
Ecuador Capability Coverage · 10 dimensions
Aporte personal + patronal monthly
8.33% from 13th month
USD table · 18% rebaja
1/12 of all remuneration
Mar 15 Sierra / Aug 15 Costa
15% profit · by Apr 15
Desahucio + despido intempestivo
15-day registration window
Every rate. Every cap. Every obligation.
Ecuador payroll operates on exact numbers with hard deadlines. Mercans builds every figure below into G2N Nova™ and monitors IESS, SRI, and Ministerio del Trabajo updates proactively.
Ecuador · Rate & Compliance Dashboard
Live 2025–26IESS Is Two Contributions Plus Fondos de Reserva — Not One Rate
Aporte personal (9.45%, withheld) and aporte patronal (11.15%) apply to the full materia gravada with no ceiling, plus IECE 0.5% and SECAP 0.5% employer. From the thirteenth month, fondos de reserva at 8.33% are added. Payroll systems must layer these and switch fondos on at exactly one year — not as a single hardcoded percentage.
→ Layered IESS + fondos logic native in G2N Nova™Income Tax Uses the Annual USD Table with a Personal-Expenses Rebaja
IR is computed on annualised remuneration less aporte personal, against the SRI table (fracción básica desgravada USD 12,208, then 5–37%). The rebaja por gastos personales then reduces tax by 18% of the lesser of declared expenses or 7–20 family baskets by dependents. Monthly withholding follows the February projection and is reconciled annually.
→ IR table + rebaja modelled in G2N Nova™Décimos and Utilidades Are Separate Statutory Payments
Décimo tercero (1/12 of annual pay, by Dec 22), décimo cuarto (one SBU, Mar 15 Sierra / Aug 15 Costa), and 15% utilidades (by Apr 15, split 10%/5%) sit outside ordinary gross pay. Décimos are exempt from IESS and income tax. Each has its own base, calendar, and Ministerio del Trabajo reporting.
→ Décimos + utilidades engine in G2N Nova™Termination Stacks Desahucio Bonus and Despido Indemnity
A desahucio (15-day notice) carries a 25%-per-year bonus. An unfair dismissal (despido intempestivo) adds indemnity of 3 months’ salary up to 3 years of service, then one month per year capped at 25 months. Final settlement also clears pending décimos, vacation, and fondos de reserva.
→ Scenario-specific severance engine in G2N Nova™Run an Ecuador payroll. Right here, right now.
Switch worker type. Move the salary slider. Every number reflects Ecuador’s IESS contribution architecture, the SRI income-tax table, fondos de reserva, and true employer cost — the same logic G2N Nova™ runs in production, dollarized in USD.
Ecuador Payroll Sample · Live
G2N Nova™ engineEight things only Ecuador experts know to handle
These are the compliance details that don’t appear in standard payroll setup guides — but appear in every IESS review, SRI reconciliation, and Ministerio del Trabajo inspection we’ve encountered in Ecuador over 20 years.
IESS Contributions on Full Remuneration from Day One
Every dependent worker must be affiliated to IESS from the first day on the materia gravada — basic salary plus overtime, commissions, and regular bonifications. Aporte personal is 9.45% (withheld), aporte patronal 11.15%, plus IECE 0.5% and SECAP 0.5%. There is no contribution ceiling. Late affiliation triggers responsabilidad patronal for the full benefit cost.
Fondos de Reserva Switch On After the First Year
From the thirteenth month of continuous service, the employer owes fondos de reserva equal to 8.33% of monthly remuneration (one month’s salary per year). The worker may opt to receive it monthly with pay or have IESS accumulate it. Systems that don’t track the one-year threshold either over- or under-pay from month one.
Décimo Tercero: One-Twelfth of Annual Remuneration
The décimo tercer sueldo equals 1/12 of all remuneration earned between December 1 and November 30. It is paid by December 22 (or monthly if the worker elects). It is exempt from IESS contributions and income tax. Excluding variable pay from the calculation base is a frequent Ministerio del Trabajo finding.
Décimo Cuarto: One SBU, Regional Calendar
The décimo cuarto sueldo equals one SBU (USD 482 in 2026) regardless of salary, prorated for partial years. It is paid by March 15 in the Sierra/Amazonía regions and by August 15 on the Costa and Galápagos. The dual regional deadline is a recurring source of late-payment penalties.
Income Tax Table with the Gastos-Personales Rebaja
Income tax runs 0–37% on the annual base after deducting the employee’s IESS aporte personal. The fracción básica desgravada is USD 12,208 for 2026. A rebaja for gastos personales reduces tax by 18% of the lesser of declared personal expenses or up to 7 family baskets (more with dependents), based on the February projection.
Utilidades: 15% of Profit, Split 10% / 5%
Employers distribute 15% of annual pre-tax profit to workers by April 15: 10% divided equally among all workers and 5% in proportion to family burden (spouse and children). The figure is reported to the Ministerio del Trabajo. Miscalculation or excluding eligible workers triggers sanctions and worker claims.
Desahucio Bonus + Despido Intempestivo Indemnity
Termination by desahucio (15-day notice) carries a bonus of 25% of the last monthly salary per year of service. Despido intempestivo (unfair dismissal) carries indemnity of 3 months’ salary up to 3 years of service, then one month per year, capped at 25 months — on top of the desahucio bonus.
SUT Registration and Monthly Ministerio del Trabajo Filings
Contracts, terminations, décimos, utilidades, and the salary-equality report are filed through the Sistema Único de Trabajo (SUT). Contracts must be registered within 15 days. Missing SUT registrations invalidate the contract record and trigger Ministerio del Trabajo fines per worker.
One workforce. Two entirely different compliance tracks.
Indefinite-contract employees on full IESS and all statutory benefits vs. fixed-term, eventual, and part-time workers on limited frameworks require two distinct compliance models, two sets of termination rules, and different benefit entitlements — both filed through IESS and SUT on every cycle.
Parallel Compliance Engines
Full IESS affiliation from Day 1. Aporte personal 9.45% withheld, aporte patronal 11.15% plus IECE/SECAP 1% on the full remuneration. Fondos de reserva 8.33% added from the thirteenth month of service.
All statutory benefits accrue. Décimo tercero (1/12 annual), décimo cuarto (one SBU), 15 days’ vacation, and a share of 15% utilidades — each on its own legal base and calendar.
Severance on termination. Desahucio bonus 25% per year of service; despido intempestivo adds 3 months up to 3 years, then one month per year, capped at 25 months.
Monthly IESS planilla + SUT contract registration. Historia Laboral filed monthly and contracts registered in the Sistema Único de Trabajo within 15 days of hire.
Same IESS rates, prorated bases. Aporte personal 9.45% and patronal 11.15% apply identically; part-time contributions are computed on actual remuneration. No reduced statutory rates exist.
Eventual and seasonal contracts have a 15% surcharge. Contrato eventual remuneration carries a legal 15% uplift; seasonal (de temporada) workers retain continuity rights across recurring seasons.
Benefits prorate to time worked. Décimos, vacation, and utilidades accrue in proportion to the period worked. Excluding short-tenure workers from utilidades is a Ministerio del Trabajo finding.
Misclassification is a primary audit trigger. Disguising an indefinite relationship as eventual or service contract triggers reclassification with back-contributions, benefits, and fines.
Every obligation. Every authority. Mercans owns the calendar.
Ecuador compliance runs across the IESS, the SRI, and the Ministerio del Trabajo on monthly, annual, and event-triggered cadences. Mercans’ managed payroll absorbs every filing as standard scope.
IESS Historia Laboral Planilla
Monthly contribution planilla covering aporte personal 9.45%, aporte patronal 11.15%, IECE 0.5%, SECAP 0.5%, and fondos de reserva 8.33% where due. Payment via the IESS portal by the deadline assigned to the employer. Late payment generates interest and responsabilidad patronal exposure.
Retención en la Fuente — Income Tax Withholding
Monthly withholding of income tax on relación de dependencia, computed from the annual projection net of aporte personal and the gastos-personales rebaja, declared and paid to the SRI. Reconciled at year-end via Form 107.
Projection of Gastos Personales
Each employee submits the projection of personal expenses for the fiscal year by the end of February so the employer can adjust monthly IR withholding. Failure to project leads to over-withholding and a refund only at annual reconciliation.
Décimo Cuarto — Sierra & Amazonía
One SBU (USD 482) per worker, prorated for partial years, paid by March 15 in the Sierra and Amazonía regions. Reported to the Ministerio del Trabajo through SUT. The dual regional calendar is a frequent late-payment trap.
Utilidades — 15% Profit Distribution
15% of pre-tax profit distributed to workers by April 15: 10% equally among all workers, 5% in proportion to family burden. Reported to the Ministerio del Trabajo. Excluding eligible workers or miscalculating the split triggers sanctions and claims.
Décimo Cuarto — Costa & Galápagos
One SBU per worker, prorated, paid by August 15 on the Costa and in Galápagos. Same SUT reporting as the Sierra cycle but on the second regional calendar.
Décimo Tercero
One-twelfth of all remuneration earned Dec 1–Nov 30, paid by December 22 (or monthly if elected). Exempt from IESS and income tax. Reported through SUT. Excluding variable pay from the base is a common Ministerio del Trabajo finding.
Final Settlement & Acta de Finiquito
On separation, the employer settles pending décimos, accrued vacation, fondos de reserva, and any severance — desahucio bonus (25% per year) and despido intempestivo indemnity (3 months up to 3 years, then one month/year, max 25). The acta de finiquito is registered with the Ministerio del Trabajo.
Ecuador is one market.
Mercans covers all of Latin America.
For companies running payroll across multiple Latin American jurisdictions, complexity multiplies — not adds. Each country runs its own tax authority, social insurance body, and filing mandate. Mercans covers all major LatAm markets on a single platform with country-specific compliance engines running in parallel.
covered
1 contract
consolidation
Latin America
Every filing. Every format. Submission-ready.
Mercans generates the exact file types that the IESS, the SRI, and the Ministerio del Trabajo expect to receive — not formatted summaries that need reformatting before you can submit them.
