Wednesday, May 31, 2023

9 questions to understand how the proposed income tax changes will affect employees

they come Major changes in tax matters for employees if a new government proposal to change the plan taxes came to light in Legislative Assembly

Executive proposal profoundly alters the way people pay taxes when the current scheduling model changes to account for global income.

EF is analyzed he file 23,760 Tax law is derived from the toilet and with the help of experts, he poses nine questions to the main changes that will happen if the proposal is approved.

What is global income and why is it important to get started?

The project is proposed by the government It is a plan that Deductible Tax Law (7,092)which he now obtains.

The executive idea is that everything the income they have in one basket and that a single tax is applied. At present, the plan of income schedule prevails in which each generation of wealth is taxed with an independent system.

“The person will present a different treatment according to the way in which they are constituted by the economic activity. For example If I act as a natural person, I will give the same treatment whether I am a minister or a liberal profession.that today there is a difference between each one”, explained Priscilla Piedra, Tax and Legal partner of Deloitte.

How will the split hooks be?

A crucial point for employee, whether salaried or self-employed, are tax brackets. And these things begin when they take away the vital minimum, that is to say. the area of ​​income from which the tax begins to be collected.

This uproar was made because of an error admitted by the Ministry of Finance, which was used in the proposal presented to the Legislative Assembly. Due to this error, the text should be amended to raise the minimum exemption from 841,000 -941,000 per month or ¢11.3 million annually (same as current).

In addition, In this new initiative, the tax payable is calculated on the basis of the full tax. Let the rates grow They moved from 10%, 15%, 20%, 25% and the new 30%.

How to enter taxes?

The proposed rate increases from 10% to 30%. In general terms, other active or passive income is added to the income that is made from the natural work of the person, the expenses owed can be deducted and this will generate an amount called the full tax base. Then the tax will be applied according to the order.

With the help of Carla Coghi, managing partner of Deloitte Costa Rica, this example arises;

If a * the wages of the wage earner is above the subsistence minimum, to whom the tax must be paid in salary income and in addition to present a declaration. If we take as an example a person with a monthly salary of one million colones (¢1,000,000), that is twelve million (¢12,000,000) per year, to calculate the tax payment, the following steps must be followed:

Annual income from work: ¢12,000,000

The least vital; 10,104,000

The full tax base: ¢1,896,000, the amount to which the sections apply.

Since the previous supply is in the range 0 to 4,728,000, 10% should be applied on 1,896,000. This person must pay a tax of 189,600.

What should an employee’s tax return look like?

At the moment salaried workers must submit income statements or taxes, because this work is done by the employer. If the government reform is approved, dependent workers will be required to make declarations and pay taxes themselves.

for now no clarity could be seen in what form or process to file this return. But it was predicted that it would be complicated.

“In other countries where The global income applied for is a complex form of about 15 pages, where each element has to be linked to the generation of resources and to be added and subtracted. At the moment we do not know the purpose of the Ministry of Finance”provided Sergio Blanco, president of the board of directors of the College of Public Accounts.

Do all salarymen file and pay their taxes?

No. The law states that only those workers who have a minimum income greater than the vital amount or at least the exempted, as is well known, are those who must present a statement of income and taxes, if applicable.

Employees who have other income or income besides their salary must report it in your word

What is the growth factor?

As The plan seeks to unite all individual incomes; any additional and lucrative activity that a natural person has, attached to their salaries, must be reported in the declaration. The project receives some income as a Christmas bonus up to an amount that does not exceed a twelfth of the ordinary and extraordinary salary in the year and the school salary.

LPensions, sales of products and some professional activities that generate income outside of working hours; the system is considered in this new form. Nor does it come back from deposit certificates, surplus from solidarity associations, etc.

What can individuals deduct for expenses?

The following can be deducted for expenses:

  • customer service: For portion 43, 400 per year per year and for each unmarried person down to the second degree of consanguinity who lives within the family nucleus, ¢31,000 per year.
  • by contributions a maximum of 10% of income to the Voluntary Supplemental Pension Scheme.
  • If you want to be any legal dispute with employers; the cost of court proceedings may be deducted.
  • The membership fees to professional associations which require it to practice a profession, such as doctors or lawyers.
  • Spending on expanding properties or fixing which are to be leased.
  • How should a person apply for partial payments?

    As a novelty, The bill also provides the ability to apply partial payments to income taxes. Once the amount has been determined, 75% of that amount must be divided into three equal installments, which are not to be paid consecutively until the next trading day in the months of June, September and December of each year.

    “If I am a hired worker and do not have other manifestations of wealth besides my salary, then the employer will withhold from me. The program mentions that the negation that has been done to the operator cannot be declared for a difference greater than 15%.”, explained Mario Hidalgo, lead tax partner at Grant Thornton.

    The expert shows that this point might cause confusionthe collaborator, when he must pay the other percentages and with this responsibility in a very organized manner.

    What about hunters?

    In the case of professionals or liberal workers, it is equivalent to the minimum amount of wage earners, that is, close to 11.3 million per year. Currently, the minimum exemption for self-employed workers is approximately four million per year, well below the established wage and salary pensions.

    Nation World News Desk
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