How to Calculate Your Income Tax Using the Income Tax Scale
1. Determine Your Taxable Income
Your taxable income is your total income minus allowable deductions. These deductions include:
- Employment income: 10% flat-rate deduction
- Pension and annuity income: 10% flat-rate deduction
- Real estate income: Actual expenses or 30% flat-rate deduction
- Business income: Actual expenses or a flat-rate deduction based on your business category
- Investment income: 40% flat-rate deduction for dividends and interest
2. Apply the Tax Scale
Once you have calculated your taxable income, apply the following tax scale to determine the amount of income tax you owe:
- Taxable income | Tax rate
- Up to €10,225 | 0%
- From €10,226 to €25,710 | 11%
- From €25,711 to €73,516 | 30%
- From €73,517 to €156,243 | 41%
- Above €156,243 | 45%
3. Calculate Your Tax
Multiply your taxable income by the corresponding tax rate from the scale. For example, if your taxable income is €30,000, your income tax would be calculated as follows:
- For the first €10,225 (0% tax rate): no tax
- For the next €15,485 (11% tax rate): €1,703.35
- Total income tax: €1,703.35
4. Additional Deductions and Credits
In addition to the flat-rate deductions mentioned above, you may be eligible for other deductions and tax credits, such as:
- Family quotient: A deduction based on the number of dependents in your household
- Disability tax credit: A non-refundable tax credit for individuals with disabilities
- Tax reduction for overseas workers: A deduction for expenses incurred while working abroad
5. File Your Tax Return
Once you have calculated your income tax, you need to file your tax return. The deadline for filing your return is generally May 31st. You can file your return online, by mail, or through a tax professional.
Additional Information
- The income tax scale is adjusted annually for inflation.
- The flat-rate deductions and tax credits mentioned above are subject to change.
- If you have complex financial or tax situations, you may want to consult with a tax professional for assistance.
How to calculate your tax according to the income tax scale?
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