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Work and income
A given fact: you have to pay income tax on your income. But what exactly do the tax authorities mean by income?
The most obvious income is your income from work. Think of your salary that you receive, a holiday job, profit from your own company, but also a benefit, pension, or taxable employee participation.
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Taxable employee participation can take various forms. For example, shares can be issued, but also stock options or RSUs (restricted stock units). Is the total value more than 5%? Then you pay tax on this in box 2. Is this not the case? Then you pay tax on this in box 3.
But what happens if you have two jobs? It is important to know that, if you are employed, you are entitled to a payroll tax credit. However, you are only entitled to this payroll tax credit once. If several employers apply this tax credit for you, there is a good change that they withhold too little tax on your wages. In this case, you have to pay it back afterward… Do you want to prevent this? Make sure that the payroll tax credit is only applied to one employer!
Income from other work
In addition to the income mentioned above, it could also be the case that you enjoy income from other work. But what exactly does this mean? If you are not employed, but are also not seen as an entrepreneur, the tax authorities refer to this as income from other work. A good example of income from other work is one-off activities. Think about giving a guest lecture at the university or when you participate in a (paid) study. You must report this income to the tax authorities, even if you only get expenses reimbursed (e.g. travel costs).
When you reach the state pension age, some things will change in your fiscal situation. The reason for this is that your income is going to be taxed through different tax brackets and -tariffs. When you take early retirement, there are also several things that you should take into account from a tax point of view.
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Do you still have any questions regarding work, income, and the tax return? Or do you have other tax-related questions? We are happy to help! Please contact us using our information mentioned below.