As per the Tax Department's announcement on 07 January 2020, according to the amendment law N173(I)/2019 as approved by the Parliament and with effect from 19 December 2019, the combined Personal Tax allowable deductions limit for the above listed payments is increased to 1/5 of the net taxable income* of the individual.
Note that a tax deduction for these amounts is, in certain cases, subject to further conditions (for example life insurance premiums are subject to a maximum of 7% of the insured amount).
The above amendment applies from the tax year 2019.
*Net Taxable Income: is the Gross Income less any deductible expenses and/or exemptions, before the personal allowances
Example of Net Taxable Income calculation: |
|
|
Gross Income |
50,000 |
|
Exemptions |
(8,550) |
|
Deductible expenses |
(500) |
Net Taxable Income* |
40,950 |
Personal Tax Allowance(limited to 1/5 of Net Taxable Income) |
8,190 |
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.