There is almost a month left to reduce my income taxes for the current year with voluntary pension and health contributions or life insurance. Up to 10% of their annual taxable income can be reduced by citizens with personal voluntary contributions for a third pension.
By another 10%, the taxable income can be reduced by personal contributions to private health insurance funds or by concluding a life insurance policy. If both benefits are used, a total of 20% of the annual income tax due can be saved. The relief is used by submitting an annual tax return by April 30, 2014. It must declare all income from the current 2013, as well as personal contributions for insurance and life insurance in order to benefit from the relief. Annual tax returns are required to file all people who have income beyond their salary. But even people who receive only wages must submit the form if they want to use any relief.
Personal contributions to private pension funds are a very good way to save money on old-age money, because you earn in two ways. First, you can invest up to 10% of your annual income in a pension fund and you will not pay taxes for this amount. If your employer has withheld all taxes due in 2013, by filing a tax return in early 2014, the treasury will refund your money. The second source of profit when saving in a pension fund is the return that companies realize from the investment of your funds. The profitability of pension funds in the last year has outpaced interest rates on bank deposits. For the last 12 months, the average return on voluntary pension funds is close to 6%, according to calculations by the Standard newspaper. At the same time, interest rates on bank deposits are constantly declining. For the last 12 months, the average interest rates on one-year BGN deposits of individuals fell from 5.33% in September 2012 to 4.22% in September 2013. Thus, saving in pension funds turned out to be more profitable than bank deposits. The only drawback is that if you want to withdraw the accumulated money before you retire, you will have to pay the saved tax of 10% when depositing the funds in the fund.
Donations reduce taxes by up to 65%
Income taxes from 2013 can be reduced with donations, but they must also be made by the end of December. And the best time to help those in need is just before Christmas. Taxes can be reduced by donating up to 5% of annual income to healthcare facilities, social service institutions, crèches, schools and universities. Up to 5% of the annual income can be donated to registered religions, communes of drug addicts, specialized enterprises or cooperatives of people with disabilities, the Bulgarian Red Cross, community centers, UNICEF, as well as non-governmental organizations registered in the Central Register of Legal Entities. non-profit persons for carrying out public benefit activity. These donations reduce the amount of annual taxable income and thus actually save taxes. Due taxes can be reduced with cultural donations of up to 15% of annual income. Up to 50% of the annual income can be given in favor of the Center "Fund for treatment of children" and / or Center "Fund for assisted reproduction". However, the total amount of the tax relief for donations may not exceed 65% of the income for the year. The relief is used by submitting the annual tax return in early 2014. The return must be accompanied by a donation agreement and a note from the bank for the transfer of money (or acceptance-transfer protocol, if the money is given in cash). If items are donated, the value of the donation is their price. But if the donated items are old - then the market price is taken as the amount of the donation.
Source: standartnews.com