Tax cards for first year and trial period?

[agroot]

According to Tax return and tax decision, the final tax people end up paying is always calculated precisely based on yearly income, regardless of the tax card yes? So the basic purpose of tax card is to determine the amount of to be withheld for now?

But first year on arrival is always shorter and there is a trial period for employment, for example:

[this year]
- start working on July this year, 2000e per month
- after 3 months of trial period, on the first day of October, it becomes 3000e per month

[next year]
- 3000e per month

PS: since the rate is very progressive and only half of the first year is counted, that means very low tax rate?

But to maximize cash at hand on the first months, would it be better - or just normal practice - to do:
1. on July, request first tax card for 2000e/month of 6 months (calculate til the end)
2. on October, request new tax card for 2000e * 3 + 3000e * 3, to reflect the increase of salary
3. on January of next year, request new tax card fort 3000e * 12

I suppose step 3 is always necessary? but what about step 1 and 2, instead of requesting the first tax card for 2000e * 3 + 3000e * 3 which is the final estimation of first year, in order to reduce withheld amount for the first 3 months?

Is the withheld by rate or by fixed amount of monthly tax, BTW?

[FinnGuyHelsinki]

You can do 2) if you want. Or just get the tax card for the estimated 2000€/month earnings, and pay taxes according to the additional percentage (which is noted on your tax card) for any earnings beyond that. In your example, in practice it will mean that your whole salary in December would be taxed with the additional percentage.

[agroot]

But the additional rate is almost double of regular rate!

Oh so that means if my tax card does not reflect my proper salary, I'd end up paying a lot more?


I suppose people just do (2) in the beginning? It's funny that my calculation indicates I'll receive more income monthly on first year, despite of slightly lower salary in trial period

[FinnGuyHelsinki]

The taxation is for the total annual earnings, not monthly (even though tax is withheld from every salary). It doesn't matter if you get even salary monthly or get all at once in a single month (or any other variation), you will pay the same (euro) amount of tax.

The additional rate is there to (try to) ensure that the government gets their share. Do the math (using the Vero tax calculator helps), probably there's not a lot of difference in total tax in euros either way, just do what suits you the best. Ultimately it will be the same (not including what you might do in the meanwhile with the tax you didn't pay), in 2020 you get any extra you paid back, or end up having to cough up some more, if you didn't pay enough.