New for 2022: an additional deduction of €65
Updated: May 31, 2022
News Flash No. 13/2022
Subject: Changes Effective in 2022: Additional Deduction from Gross Tax for Taxpayers with Income Between 25,001 and 35,000 Euros
The 2022 Budget Law introduced, among other things, amendments to Article 13 of the Consolidated Income Tax Law, concerning the calculation of gross tax deductions, which are determined differently depending on the type of income included in total income.
For income from employment and similar sources, if the total income exceeds 25,000 euros but does not exceed 35,000 euros, the applicable deduction is increased by 65.00 euros.
This amount is intended as an upward adjustment to the deductions that were previously re-calculated on a pro-rata basis and must be paid, provided the above-mentioned income requirements are met, in full during the year 2022, as a one-time payment, without adjusting it based on the period of employment during the year.
It follows that the withholding agent must apply the additional deduction of 65 euros starting with the first applicable pay period of 2022, provided that at the end of the year, or upon termination of employment, the withholding agent must recalculate the deduction actually due based on the total amount of compensation paid during the tax year.
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