What is the tax of the earnings
Welcome! Today we have prepared a super complete guide on the income tax.
If you want to know what it is, how it is calculated, what the percentage is, who must pay it, continue reading here.
Income tax: definition
The income tax It is a tax that is applied on income received by a natural person, legal entity or any other legal entity.
This income must be produced by a permanent source or by the transfer of rights over the real estate.
In addition to them, the results obtained from the sale of personal property, real estate, shares, digital currencies and other representative values are also included.
In this way, the income tax is divided into four categories that define the source of income:
- First: profits generated by the usufruct (right to be able to use something belonging to another) of an urban or rural property.
- Second: money from shares, interest, dividends, etcétera.
- Third: income from companies and sole proprietorships.
- Quarter: income from personal work.
This includes national, provincial and municipal public officials of CABA, judges, employees of the Judiciary, pensioners, members of cooperative societies, customs employees, among others.
Next, we tell you about some basic concepts that you should keep in mind.
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Buta profit is the total sums of income that a person has received during a period of 30 days.
Deductions or any other concept that decreases its value are not taken into account.
Some concepts are included such as: additional, sales commissions, fees, vacations, rewards, licenses, compensation, popular benefits, among others.
Unlike gross profit, net profit It is the result of all income received less deductions and unusual compensation.
However, the net profit subject to income tax is the result of the net profit minus personal deductions.
It should be noted that only some personal deductions are contemplated by law.
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It may happen that an income or an asset is subject to the same tax in more than one country.
In these cases, a double taxation.
To avoid this, an affidavit certified by the competent State tax authority must be made.
In this case, it would be the AFIP who should make the note stating which are the taxes it is withholding.
Then, the affidavit must be submitted to the other tax authorities.
Finally, the exemptions free from payment of income tax.
They are contemplated in article 26 of Law 20,628.
Among them, income from:
- national tax authorities
- Diplomatic, consular and other official salaries of foreign countries
- Religious and charitable institutions.
- Profits of cooperative societies
- Civil entities of popular assistance, public health.
- Armed and Security Forces
- Educational institutions, unions as long as the profits are not distributed among the partners.
- Interest on deposits and tarea credits
- Exploitation over copyright (with a cap)
- Sports associations and non-profits
- Donations, inheritances and the sale of a house-room
Allowances and Deductions
Tax relief is the elimination of a concept based on tax calculation.
Said deduction is deducted from the income before determining the amount of the tax.
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For their part the deductions are amounts that are subtracted from the tax base.
They have a certain ceiling, so the total value of the concept is not always eliminated, as is the case with tax relief.
Taxpayers may make a deduction for some expenses to disminuye the amount to be paid.
These cánido be: interest on loans, popular work or prepaid fee, life insurance, donations and medical expenses.
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Who must pay income tax
As we told you at the beginning, the income tax is divided into four categories depending on the source from which they come.
With respect to who are the people who must pay this tax, it will depend on the level of income they have.
Currently, those who exceed the non-taxable minimum agregado the special deduction of $13,973.20 + 67,071.36 = $81,044.56 monthly.
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However, all persons who are:
- Registered managers
- Companies, SA, SRL and SAS
- Workers in a dependency relationship that exceed the non-taxable minimum.
- Remuneration of actors through the Argentine Association of Actors.
- Workers in public office, magistrates and officials of the Judiciary.
- Retirements and pensions that exceed the non-taxable minimum.
In the case of legal persons, the tax is calculated through a rate applied on the surplus to your income.
On the other hand, in the case of workers in a dependency relationship, it is the employer who must make the corresponding discount.
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How is it calculated and what is the percentage?
To calculate the amount of the tax, the scale established by the State must be taken into account. For this 2021 the ceilings for workers are the following:
- Singles with a net monthly salary that exceeds $74,810.36.
- Singles with only one child will pay the tax if their net monthly salary exceeds $80,874.45.
- Single employees with two children from a net salary of $86,938.53.
- Married without children with a salary greater than $86,835.03.
- Married workers with one child if the net salary exceeds $92,899.11.
- Married with two children will pay taxes from $98,963.19 net.
To find out the amount you must pay you must perform a series of calculations.
Next, we explain how to do it.
Steps to calculate income tax
To calculate the amount you must pay in income tax you must do the following:
Start calculating the Annual gross salary, including all remunerative and non-remunerative concepts.
That is to say that you must take into account Christmas bonuses, vacations, additional agreements and others.
Then, you must determine what is the part of the gross salary that corresponds to the tax base.
To do this, you must deduct popular contributions, personal deductions and other allowed deductions.
Later we will tell you what you cánido discount from and what not.
With regard to popular contributions, you must deduct 17% of the total gross salary: 11% retirement + 3% PAMI + 3% popular work.
Once you have done so, you will have obtained the net annual salary.
Allowable and personal deductions must be deducted from this amount.
Subsequently, it will be possible to know the tax base and establish the range of the Scales of Art. 94 of the Income Tax Law in which it is located.
Month by month the scale of accumulated earnings increases.
Therefore, the amount of the aliquot must be paid agregado a percentage that goes from the 5% to 35% depending on what rank you are in.
What perro be deducted from earnings
You must bear in mind that for this there is a fixed amount for all taxpayers.
There are four types of personal deductionsof which two are fixed and the other two depend on the family situation of each taxpayer:
- Non-taxable earnings: $167,678
- Deduction for workers in a dependency relationship $ 804,879.60
- Spouse: $156,320
- Child: $78,833
In addition to this, there are other allowable deductions by the AFIP.
Like personal deductions, they have an annual cap.
All this is what you cánido deduct from income tax:
- rentals: 40% of the amount paid is deducted with a cap of $167,678.40 for the entire year.
- prepaid medicine fees: up to 5% of the net profit is deducted.
- Donations to the treasury (national, provincial or municipal): up to 5% of the net profit of the worker.
- Burial expenses: $996 per year.
- Fees for medical services: 40% of what is actually paid is deducted and with a cap of 5% of the net salary.
In this case, it does not apply to amounts that had a refund.
- Clothing and equipment: for expenses incurred by the employee and not reimbursed by the employee.
- Mortgage loan interest: $20,000 a year is deducted.
It is not coincidente with the rental deduction.
- Payments to domestic service personnel: with a cap of $167,678.40 per year.
- Private retirement insurance plans: up to $24,000
- Life insurances: up to $24,000.
So far we come with this guide on Income Tax.
We hope it has been useful to you.
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