The IRPF When each year begins, especially if you are self-employed or have variable income, you may have wondered how much you will pay in Personal Income Tax. In this guide, we will help you calculate it so you can make an estimate.

When I talk about the percentage of IRPF that corresponds to you, we refer to the part of your income that you have to pay to the Treasury to meet your tax obligations. It would help if you got an initial idea to not get a scare with the amount you have to pay when you make the income statement.

In this director, we will show you a few simple steps to estimate the percentage of personal income tax on your payroll during the year to Align with the Treasury regulations. So that you do not miss whatever, I have prepared an index that will help you structure the topics that we are going to see:

  1. How does personal income tax work?
  2. How to make the estimate?
  3. Frequent questions
  4. How to fill in Form 145?

1. How Does The IRPF (Personal Income Tax)?

Personal income tax is the tax you have to pay for all the annual payments you receive as an individual, whether income from work or capital gains. It is a progressive tax. To put it colloquially, the more you earn, the more you pay! First of all, you must know the general operation of the tax.

The Treasury has stipulated some standard ranges of a percentage of the tax that you must pay according to the tax base that you declare total earnings and according to your situation. And that is what you have to pay per year.

Regarding The Income From Work Received, The IRPF Acts As A Deferred Tax, That Is:

The company withholds part of your gross salary on the payroll as IRPF and pays it to the Treasury on our behalf.

When the Treasury makes the final settlement of the tax based on all your earnings, both property and work, and deductions for other personal situations that correspond to you, it will calculate what percentage and the total amount you must pay that year. This settlement takes place in what know in Spain as the “income statement”.

If you have been withheld more as personal income tax during the year than what you should pay, then in the income statement, the Treasury will return the remaining part. On the contrary, if you have withheld less than what we have to pay, you must pay the Treasury the remaining amount until you reach the law’s total.

Let’s Take A Simple Practical Example:

Our total earnings for the year have been €30,000. Established in the ranges, says the Treasury, it is up to us to pay the State 17%, that is, 30,000 * 17% = € 5,100.

Our company has withheld 20% from our payroll every month during the year. That is, we have paid 30,000*20%=€6,000 in taxes.

We have paid more than what corresponds to us. Therefore, the Treasury will return the remaining 6000-5100 = €900.

On the other hand, the company had withheld 15% every month on our payroll. We would have already paid 30,000*15%=€4,500 in taxes.

In this case, we have paid less than our fair share. Therefore, in the final income statement, we will have to pay the remaining part 5100-4500 = €600.

How To Estimate The Type Of Personal Income Tax That Corresponds?

It isn’t easy to know our situation at the end of the year, how much our earnings or our possible deductions will be. Numerous factors play a role here, such as the autonomous community where we declare, housing rental contracts, mortgages, dependent children, school or union fees, etc.

In this guide, we will get attention to the income from the work part and how to make the most accurate estimate on our payroll. For this part to be controlled and aligned with legal requirements.

We recommend using the following calculator that the AEAT that the Tax Agency makes available to us to estimate the calculation.

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