The extension eventually granted by the Ministry of Finance for the submission of tax declarations represents an opportunity for re-examination and correction of potential errors and data in the “SOS” fields of the E1 form that will reduce the “bill”.
Last night, the postponement of the deadline for the submission of income tax declarations was announced as follows:
• On August 2 for individual declarations,
• On August 9 for corporate declarations. The postponement of the deadline is relatively longer in this case due to the additional reason that the submission rate is not as high as in the case of individuals.
Correspondingly, the deadline for the payment of the first installment of the tax is also postponed to 2/8 for individuals and 9/8 for corporations.
However, the possibility of one-time tax payment with a 3% discount for individuals remains until July 31.
The points that need to be checked
To avoid unpleasant surprises that will cost, the “code – code” data pre-filled by the AADE must be checked to determine whether they are correct and accurately reflect the actual income, asset, and family situation as well as the cost of living.
If problems are identified, the next step is to delete, add, and correct even if the taxpayer has already submitted the declaration.
Amendment declarations until August 2
Taxpayers who find incorrect or incomplete information in the initial declaration can proceed with corrections by submitting an amendment until the upcoming Friday, August 2, without incurring penalties.
The data that you need to check thoroughly as they affect the tax account are:
1.Income: Instances where income certificates from employers or insurance agencies are incorrect are not few, resulting in problematic pre-filled data from the AADE, and you must contact the company or agency since those specific codes are locked, and you cannot intervene.
2.Family status: Check the details of the dependents listed by the AADE in the tax declaration as they increase the tax-free threshold and provide significant discounts on the final amount of income tax.
3.Deductions: These refer to cars, real estate, expenses for loan repayment, tuition fees, and other expenses that the AADE has listed in the corresponding codes of the form, based on which the minimum taxable income is determined.
If the declared income is lower than the deemed income, you will be required to pay tax based on the objective expenses. Therefore, it must first be checked whether the data is correct and if it is not, relevant changes should be made.
Also, if your income is lower than the deemed income, you have the option to avoid the burden if you list in the corresponding codes amounts that cover the difference, such as capital consumed from income from previous years, compensations, sales of assets, donations, parental gifts, inheritances, loans, winnings from lotteries, etc.
Be careful if you made high-value purchases in 2023, such as cars, real estate, and others, as you will need to justify the source of the funds.
It is noted that deemed income constitutes a criterion for the granting of allowances, subsidies, and social benefits, and if it exceeds the limits set by law, it excludes taxpayers.
4. Receipts: The amount of total expenses with plastic or electronic money for the purchase of goods and provision of services has been pre-filled by the AADE based on the data sent by banks, but you should check whether the amount corresponds to 30% of your income, as if it is lower, you will be charged an extra 22% tax on the difference. The code is open, and you can fill in the amount if you have a deficit of receipts.
5. Bank accounts (IBAN): If you are entitled to a tax refund and have no debts, to get the money, you should list your bank account number (IBAN) in the tax declaration; otherwise, you will never see the money.
6. Hosting: Taxpayers who are hosted in relatives’ homes must fill in the indication “Hosting” in the corresponding code of E1 to avoid the deemed residence.
7. Student residence: The residence rented by children – dependent members studying away from the permanent residence should be stated as secondary by the parent to burden them with the deemed expenses.
8. New professionals: They receive a 50% reduction in the minimum tax rate, while the advance tax payment is also reduced by half.
9. Insurance contributions: The insurance contributions paid in 2023 by employees to mandatory insurance organizations to buy time of insurance (e.g., military service time) reduce the taxable income from paid employment.
10. Uncollected rents: Those who did not collect rents in 2023 must have issued a payment order or a order for the delivery of rented premises or a judicial eviction order or a judgment for rents, or a lawsuit for eviction or for rents should have been filed (submitted and notified) against the tenant.
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