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On December 22nd, 2021, Decree Number 43375-H was published in the Gazette Number 288, which updates the salary, income, and tax credit tax brackets as of January 1, 2022. The update brings with it an adjustment of 2.50%, so it would be as follows, as of the date indicated above:
WAGE TAX:
| Ammount | Tax (%) |
| Up to c.863.00.00 | Not subject to tax |
| On the excess of c.863,000.00 up to c.1,267,000.00 | 10% |
| On the excess of c.1,267,000.00 up to c.2,223,000.00 | 15% |
| Over the excess of c.2,223,000.00 up to c.4,445,000.00 | 20% |
| On the excess of c.4,445,000.00 | 25% |
TAX CREDITS (established in article 34 of the Income Tax Law)
For clarity, the tax credit is the amount of value added tax (VAT) that every taxpayer pays to the suppliers of goods and services, having said the above the new tax bracket for tax credits are:
• For each child, the sum of c.1,610.00.
• For the spouse, the amount of c.2,430.00.
INCOME RATES FOR LEGAL ENTITIES WHICH INCOME DOES NOT EXCEED c112,070,000.00:
|
Net Annual Income |
Tax (%) |
| Up to c.5,286,000.00 | 5% |
| On the excess of c.5,286,000.00 up to c.7,930,000.00 | 10% |
| On the excess of c.7,930,000.00 up to c.10,573,000.00 | 15% |
| On the excess of c.10,573,000.00 | 20% |
INCOME BRACKETS FOR INDIVIDUALS WITH LUCRATIVE ACTIVITIES:
| Annual Income | Tax (%) |
| Up to c.3,836,000.00 | Not subject to tax |
| On the excess of c.3,836,000.00 up to c.5,729,000.00 | 10% |
| On the excess of c.5,729,000.00 up to c.9,555,000.00 | 15% |
| Over the excess of c.9,555,000.00 up to c.19,150,000.00 | 20% |
| Over the excess of c.19,150,000.00 | 25% |
TAX CREDITS FOR INDIVIDUALS WITH LUCRATIVE ACTIVITIES:
• For each child, the sum of c.19,320.00.
• For the spouse, the sum of c.29,160.00
It is of utmost importance to consider these changes in the salary tax brackets, income tax and tax credits to make sure that the corresponding payments are made and to avoid possible inconveniences with the tax authorities. If you require help or advice on this subject, ERP Lawyers has a team specialized in this matter that will be glad to help you. Do not hesitate to contact us at info@erplawyers.com.
