SELF-EMPLOYED REGISTRATION (CHAPTER 4) – BUSINESS ACTIVITY MAIN & REGULAR TAX DECLARATIONS DURING THE YEAR
TAX FORM 130 / 131 (INCOME TAX)
It gets paid every quarter, and it corresponds to net earnings in the quarter.
It accumulates net earnings as the year goes along. So that, second quarter accumulates first, and second quarter earnings, third quarter accumulates first, second, and third quarter net earnings, and forth quarter does the same.
Tax paid every quarter is calculated to a 20% of the net accumulated earnings, and tax paid in the previous quarter is deductible in order to avoid double taxation along the year.
Upon the event that business owner regularly raising invoices of earnings were tax at source, and he/she did not get the full amount from the invoice paid, tax paid at source will be considered as a part-payment to the 20% quarter tax on net earnings due to pay out of this form 130.
Business owner (proffessionals, and agricultural & forrests care business owners) will no longer have the obligation to submit this tax form in the year 2 from business start year upon the event that more than 70% of the earnings were taxed at source in the previous year, and paid to them by the same client. So that, one and only income tax obligations during the year will be the tax retained at source by the payer.
Annual informative tax declaration associated to this tax declaration is TAX FORM 100, and it gets presented in the following year within the 01.05 and the 30.06 to the following year. This annual self-assessment is particularly special compared to the quarterly tax declarations (tax forms 130 / 131) because it incorporates the personal and familly allowance before the tax % is calculated over the total taxable earnings (net earnings minus allowance).
Income tax system all over the EU area is worked at under the main principle to the more you earn, the more you pay. However, personal and family circumstances are always taken alson into consideration. In summary, a single person with 30.000 euros earnings in the year, and living on his own pays a much higher percentage of tax than a married family couple with three children, one of them 50% disable, but with the same level of 30.000 euros earnings. In principle, family and personal allowance is what makes the difference in between tax payers once the year is finished.
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