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Tax returns: What to watch out for to save taxes – The codes that give discounts

The critical dates and keys to reducing the "bill" for 7.5 million taxpayers filing tax returns

Newsroom March 17 08:39

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The AADE‘s online platform for filing 2025 tax returns for individuals opens today. More than 7.5 million taxpayers have until July 15 to detail all income they earned in 2024. It is especially important to carefully fill in specific codes, as errors or omissions can result in increased tax or loss of significant deductions.

This year, the discount for a one-time payment of income tax is staggered depending on the date the return is filed: if filed by April 30, a 4% discount applies; from May 1 to June 15, a 3% discount applies; and from June 16 to July 15, a 2% discount applies, provided the tax is paid in one lump sum by July 31. There is, however, the possibility to pay the tax in up to 8 monthly installments, in 12 interest-free installments via credit card, or in up to 24 interest-free installments with the fixed arrangement of the AADE.

New professionals who started after 1 January 2022 are entitled to a reduction in the minimum tax rate from 9% to 4.5% for incomes up to €10,000, as long as they correctly fill in codes 017-018 of the E1. In addition, those who declare income from business activity for the first time pay half of the advance tax, as long as they fill in codes 327-328.

Also, it is important for parents to know that children who are accommodated in the family home are not subject to a presumption of residence, as the burden falls on them. At the same time, when a child is studying away from the permanent residence, the student house must be declared by the parents as a secondary residence in order to avoid a tax burden on them.

Those over 70 years of age, those who are over 80% disabled and those serving their military service are exempt from the obligation to collect receipts with electronic transactions equivalent to 30% of income. In these cases, codes 023-024 must be completed.

Favorable changes are also related to real estate and leases. Landlords who converted short-term leases to long-term leases or rented houses that remained unoccupied for at least three years are entitled to a full three-year income tax exemption by reporting in codes 119-120.

As for employees in the food industry, gratuities up to 300 euros per month are now tax-free, as long as they are correctly declared in codes 689-690 and 691-692.

In addition, those who have a professional headquarters and main residence in villages with less than 500 inhabitants or on islands with less than 3,100 inhabitants, single-parent families with minor children, and professional taxis with a small percentage of ownership are entitled to a 50% discount on imputed income (codes 047-048).

At the same time, special categories of taxpayers, such as farmers, professionals operating in small settlements, people with a disability rate of 80% or more, and insurance consultants with up to two companies working from home (codes 045-046), are entitled to a full exemption from excise taxes.

Taxpayers who are over age 65 (born by December 31, 1959) are eligible for a 30% deduction on presumptions if they select the “YES” field in codes 013-014.

To cover presumptions you can report income from property sales, lump sums, inheritances, parental benefits or loans in codes 781-782. Similarly, those who made e-money expenditures for property renovation or energy upgrades in 2024 can get a tax deduction of up to EUR 3,200.

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Finally, taxpayers with a disability of over 67% can secure an additional EUR 200 deduction by selecting “YES” in codes 001-002.

In any case, employees, pensioners and professional farmers retain the tax deduction of EUR 777 to EUR 1,340 depending on the number of dependent children, which practically determines the tax-free threshold.

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