?yearly salary: Spain?
Out of context: Reply #26
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The purpose is to make it harder for people to know how much tax they're actually paying and compare with other systems.
rafalski
(Aug 22 07, 03:39)ahahah - probably it is! but hey it's not 10%!!!
around here is not difficult to grasp the whole picture, though: any worker (contract or independant) usually pays 20 to 25% tax (social tax+irs) in a medium income/yr.
for a person who only works freelance there's 11% of fixed social tax + irs (that can range from 10% to 20%, depending on regular income per year and household composition). if a frellance earns more than €10k a year in 1 activity he has registered then it is mandatory to charge IVA over your services (IVA is a special tax of 19% that goes out from the pocket of your client straight to the State's. It is bad because it raises your earnings volume and puts you up in the top scale = irs 15%).
freelance is good here because you can have a "company" withouth formally having a firm - IRC (taxes for companies is 35%, which is very limiting for newborn companies. usually people work for a long time freelance before going corporate.
You're only free of Social Tax in freelance if you already pay it in other activity.