No Tax Return for Many Retirees from 2016
- Tax Experts
- Jun 5
- 1 min read
August 1, 2014
No Tax Return for Many Retirees from 2016, as the Ministry of Finance introduces a simplified taxation scheme for pensioners receiving only retirement income, aiming to reduce compliance costs and streamline tax procedures.
The Ministry of Finance is planning to exempt pensioners from the obligation to submit an income tax return, if they do not receive income from other sources.
This practice is expected to be effective from the financial year 2016, income received in 2015. More analytically, the scheme of the single calculation of the monthly withholding tax and special solidarity levy on the main and supplementary pensions will be applied in the whole year.
Consequently, the overall burden will be calculated and deducted at source. The E1 form submission will be optional for retirees with no other sources of income except pensions. In contrast, other pensioners receiving income from rents, securities and other assets will be required to submit their tax return declaring the remaining revenues.
In conclusion, it is estimated that over 1.000.000 retirees will not have to fill in a tax return after the application of this regulation, which shows the trend of tax compliance cost decline for a large number of taxpayers.
