How much tax will the free professions pay? Examples/ The obligation to pay is distributed in 3 installments

About 29,000 entities that belong to the category of free professions, will have to prepay the tax on profit during this year, where they are already familiar with the obligation they have.

But how much is this tax and how is it calculated? The tax administration clarifies that for taxpayers with the legal status of a natural person, the calculation of prepayments is carried out with progressive rates: 15% up to the amount of profit of 14 million allek and 23% for any value of profit above 14 million allek. For taxpayers with a different legal status than a natural person, regardless of their tax liability, the calculation of prepayments is carried out at the rate of 15% on the profit.

If we will take an example, a natural person entity that has a profit of 9.6 million lek per year, will have to pay nearly 1.4 million lek in tax, after they have recognized the deductible expenses at the level of 35%.

While a business that accumulates a profit of 15.4 million lek, will have to pay a tax rate on this profit at the level of 23 percent, calculated in a total of nearly 3.5 million lek, divided into several installments.

The calculation of preliminary installments for the year 2024 for all taxpayers registered before 31.12.2023 is based on the profit self-declared by the taxpayers in the annual tax return, for Income Tax (due until March 31, 2024) or Simplified Income Tax ( with a deadline until February 10, 2024). The estimated value has been divided for the remaining period April-December 2024, in 9 installments.

For taxpayers, who during 2023 were partially registered with both Simplified Income Tax and Income Tax, the calculation will be performed on the total self-declared income in the 2 respective statements and the taxpayers will be notified in their account in e-Filing, regarding advance installments.

Taxes clarify that installments can also be paid on a monthly basis, but their term is 3 months. Specifically: by June 30, it is paid for the months of April, May, June; By September 30, for the months of July, August, September and by December 31, for the months of October, November, December.