The legal and technical deputy of the country’s tax affairs organization announced how to calculate salary tax.
According to the circular dated 26/1/2019 of the legal and technical deputy of the tax affairs organization, the subject of the annual salary exemption as well as the salary income tax rate for the year 2019 according to the provisions of Part 2, Paragraph A, Note 12 of the Budget Law of the year 2019 for the whole country was determined as follows.
1- The tax exemption ceiling subject to Article 84 of the Direct Taxes Law is set at three hundred and sixty million (360,000,000) Rials annually in 2019.
2- The tax rate on the total income of government and non-government employees, including salaries and extraordinary benefits, in excess of the said amount up to one and a half times, is subject to annual tax at the rate of ten percent (10) and in relation to the excess one and a half times up to Two and a half times of it is subject to an annual tax of fifteen percent (15), and in relation to the excess of two and a half times to four times, it is subject to an annual tax of twenty percent (20), and in relation to the excess of four times, it is subject to a tax of twenty five percent (25). .
Persons who benefit from tax exemptions subject to Note (1) of Article 86 of the Law on Direct Taxes are not subject to the exemption of Article 84 of the aforementioned law according to the provisions of this part.
3- The rights of university faculty members in accordance with Article 5 of the law amending some of the provisions related to the basic rights of teaching and research faculty members (employed and retired) of universities and higher education institutions approved on 12/16/1368 with subsequent amendments and additions. In compliance with the exemptions provided in the Direct Taxes Law, it will be taxed at a rate of ten percent (10%) in 2016.
4- Based on Article 5 of the law amending some of the regulations related to the salary base of official members of educational and research faculty (employed and retired) of universities and higher education institutions from the taxable income of academic faculty members subject to this law, subject to the exemptions provided in the Taxes Law A maximum of ten percent (10) will be deducted directly as tax.
Considering that in part (2) of paragraph (a) of Note 12, the term “work” is used outside of the excluded cases related to the rights of faculty members, therefore the karate received by faculty members (in compliance with Circular 200/98518 dated 98 21/11/10 is not subject to the rate of 10% and according to the amount that the salaries and benefits of university faculty members cover the prescribed staggered rate, it will be taxed at the next rate.
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