From 2023 there will be two types of personal deductions

From January 2023 income, Ordinance 16/2022, which amended the Tax Code, provides that the personal deduction will have two components: the basic personal deduction and the additional personal deduction.

The basic personal deduction is granted to people who have a gross monthly income of up to 2,000 lei above the level of the gross minimum wage. It is differentiated not only according to income but also according to dependants, including children. So while the basic deduction for children is attributed to both parents, the additional deduction is different.

The additional personal deduction is granted as follows:

• 15% of the minimum gross basic wage guaranteed in payment for individuals up to the age of 26 who earn up to 2,000 lei above the minimum gross basic wage.
• 100 lei per month for each child up to the age of 18, if the child is enrolled in an educational establishment. The deduction is granted to the parent who earns income from wages, regardless of the level of their income. “If the child is supported by both parents, the additional personal deduction is granted to one of the parents on presentation of the document certifying the child’s enrolment in an educational establishment and an affidavit from the parent receiving the deduction. If the parent works for more than one employer, in addition to the required documents, the parent who benefits from the additional personal deduction must declare that he or she does not benefit from such deductions from another employer,” the law states. Employers must inform employees who make such declarations that they must reflect reality and that false declarations are punishable by law.

Attention! The deduction does not mean that parents will receive 100 lei for each child enrolled in school, but that the tax base is reduced by 100 lei, which means a “gain” of only 10 lei.