They are using relief now, and in January it will be deducted from their wages
The Change introduced the possibility of current use of tax reductions
And the heirs with lower taxes
Many mothers will have to pay money back to the Exchequer, which they currently receive as tax relief. This mainly applies to low-wage parents who have three or more children. And the reason is the opportunity introduced during the “Petkov” government for current use of the tax relief for children and children with disabilities.
The law makes it possible for people with July wages received in August to use the child tax credit for the first six months of the year. And with the salary for October, the relief for the months from July to September should be used. This means that the taxable income for October should be reduced by BGN 500 for each of the months from July to September for one child, by BGN 1,000 for two children and by BGN 1,500 for three or more children. And if the taxable income for October is less than these amounts, the relief must be given by the employer, who then deducts the amount from subsequent obligations to the treasury.
For example, a mother of three children has a gross salary of BGN 930, after payment of insurance she has a taxable income of BGN 800 per month, and after taxes and insurance she receives a net income of BGN 722. She is entitled to a tax relief of BGN 1,500 per months, or a total of BGN 4,500 for the months from July to September. However, the salary for October after insurance is only BGN 800. Therefore, her employer must give her 10% of the difference or BGN 370 (10% of BGN 4,500 minus BGN 800). The employer will then deduct this money from their other tax liabilities. But in January, the taxes owed by the mother will be recalculated. And if she used more relief than her annual taxable income, the money will be deducted from her salary. If this mother with the salary for July has already used the tax relief for the first six months of the year, it will turn out that in January 230 BGN will have to be withheld from her salary because of the already used tax relief for children.
In order to make this a reality, the Ministry of Finance has released for public discussion changes to the Law on Personal Income Taxes. The changes also enable heirs of deceased parents to use the relief for their children when filing tax returns on their behalf.