The Ministry of Finance has published its annual overview of the most significant changes to taxation for the new year: the end-of-year report.
Numbers
The appendix to this notice contains an overview of the tax parameters for 2019–2022. In other words: all the figures used in the calculation of taxes.
Income tax
Income tax rates remain virtually unchanged. Only the rate at which most deductions are applied is falling: from 43% to 40%. However, this is the result of a measure that was already introduced in 2020.
The tax-free allowance in Box 3 is being increased from €50,000 to €50,560 (per tax partner). The rate remains 31%. The tax brackets are as follows:
| Basis for calculating returns (above the tax-free allowance) | Efficiency |
| up to €50,560 | 1,82% |
| between €50,560 and €962,350 | 4,37% |
| over €962,350 | 5,53% |
On 24 December 2021, the Supreme Court ruled that, for the years 2017 and 2018, the levying of income tax on income from savings and investments based on flat-rate returns was contrary to European law. See our article Supreme Court ruling on Box 3 tax. The tax may be levied on the actual return achieved, up to a maximum. It is not yet clear exactly how this is to be determined.
Corporate tax
The rate for corporation tax is changing, however. This involves an increase in the tax bracket threshold – the portion of the taxable amount to which the low rate of 15% applies – from €245,000 to €395,000. And the increase in the higher rate from 25% to 25.8%.
With effect from 2022, withholding taxes (dividend tax and gambling tax) may only be set off against the corporation tax due. Where the corporation tax due is less than the withholding taxes, no tax will be refunded. However, withholding taxes that have not been set off may be set off against future corporation tax liabilities without any time limit.
From 2022 onwards, losses can once again be carried forward indefinitely. However, where profits exceed €1,000,000, only 50% of the losses will be offset.
Payroll tax
The most significant change to payroll tax is the introduction of a specific allowance for the reimbursement of home-working expenses: €2 for each day worked from home. This allowance may not be combined with any reimbursement or provision covering the costs of commuting.
The allowance under the work-related expenses scheme (WKR) for 2022 is: 1.18% (for a total wage bill of up to €400,000: 1.7%).
Car
The additional tax liability for the private use of a company car remains at 22% of the list price.
For zero-emission cars, the additional tax liability will rise from 12% in 2021 to 16% in 2022. The lower additional tax liability applies in 2021 to catalogue values up to €40,000 and in 2022 to €35,000. The revised rate applies only to new cars, as the rate applicable at the time of the car’s first registration remains in force for 60 months.
Gift tax exemptions
Many people are keen to know the exact amounts of the gift tax exemptions:
| Acquired by: | Exemption 2021 | Exemption 2022 |
| Children | € 6.604 | € 5.677 |
| Children aged 18–40 (one-off) | € 26.881 | € 27.231 |
| Children aged 18–40 (one-off payment for study purposes) | € 55.996 | € 56.724 |
| Children aged 18–40 (one-off payment per property) | € 105.302 | € 106.671 |
| Other | € 3.244 | € 2.274 |
You can find out more about the exemptions and the rate of gift tax in our factsheet Gift tax exemptions.
The Coalition Agreement of the new Government states that the tax exemption for one-off gifts to children aged between 18 and 40, to be spent on their own home (the ‘jubelton’), will be abolished with effect from 2024.