Income Tax in Slovenia
Income Tax in SloveniaUpdated on Monday 12th April 2021
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The income tax in Slovenia is a type of tax that is charged on the income of individuals and corporate entities. The Slovenia income tax is charged on various types of incomes, as well as on parts of incomes, which can be from direct or indirect income.
One must also know that the income tax can be charged on the worldwide income of an entity, meaning that the tax is applied to the income obtained by the respective entity from global sources (other jurisdictions than Slovenia) or only for the income obtained at a national level.
If you are a natural person who obtains income from various sources in Slovenia (employment, rental activities, etc.) you are considered to be liable for taxation. The Slovenia income tax is charged for companies as well, at different rates than the ones applied to natural persons. For tax advice on the income tax regulations, we invite you to address to our team of Slovenian lawyers.
What are the general rules on the Slovenia income tax?
The implementation of the rules regarding the Slovenia income tax falls under the supervision of the Financial Administration, where taxable entities have to pay their taxes at the end of the financial year. In Slovenia, starting with 2005, Slovenian residents are liable for their personal income tax charged on a worldwide level.
This means that a person can become liable for the Slovenia income tax regardless of the source of the income and the location of the capital. Foreigners who obtain a taxable income in Slovenia will become liable for taxation in Slovenia for the income that they have obtained here from various sources of taxable income, such as salaries, real estate, properties and others.
The legal framework for the taxation of the income is also influenced by the double tax treaties signed by the Slovenian authorities with the institutions of other partner countries and, if you are a foreigner, the sources of income liable to taxation as well as the rates at which you will be taxed can be influenced based on the regulations established within a treaty. If there isn’t a double tax treaty signed with your institutions of your tax residency country, other tax rules will apply and our team of Slovenian lawyers can assist you.
What are the Slovenia income tax rates?
The taxes rates at which the income of an entity are charged in Slovenia vary based on the nature of the entity, as well as on the chargeable income. There are two main categories of Slovenia income tax rates, one referring to the taxation of corporate income, and the other, on the taxation of the income of natural persons. The tax rates are as follows:
- the Slovenia income tax rate charged on the corporate income is of 19%;
- for the taxation of natural persons, the tax is charged on a progressive system and the lowest tax rate is of 16%, charged for an income of maximum EUR 8,500;
- a tax rate of 26% is applied for an income of minimum EUR 8,500 and maximum EUR 25,000;
- income of EUR 25,000 – EUR 50,000 is taxed at a rate of 33%;
- persons gaining an income of minimum EUR 50,000 and maximum EUR 72,000 are charged at a rate of 39%;
- any income with a value above EUR 72,000 is charged at a rate of 50%.
What other type of income qualifies for the Slovenia income tax?
The tax law in Slovenia establishes the types of income that are charged with the income tax, as well as the international tax treaties to which Slovenia adhered to. Our law firm in Slovenia can present the current legal framework to those interested in this subject.
Currently, one has to know that the Slovenia income tax is also applied to capital gains, a type of income which is charged at the standard rate of 19%, as long as the capital gains are related to corporate entities. With regards to the taxation of capital gains other rules and taxes can apply depending on the tax residency of the company, if a merger is involved and other legal situations, which can be presented by our lawyers in Slovenia.
If you refer to capital gains obtained by natural persons, the tax will be charged at the standard rate of 27.5%. The same tax rate is applied on the income of a natural person obtained from interest, dividends and rental income. However, persons and entities which are the beneficiaries of the provisions of the double tax treaties which are in force in this country will benefit from lower tax rates.
The taxes charged on the taxation of dividends and interest are generally taxed at a rate of 15%. The same applies for the taxation of royalties. If you need additional information on the Slovenia income tax regime, we invite you to contact our Slovenian law firm.