You can use your annual income statement to check your tax return. Your annual income statement for last year will be forwarded to you in March of this current year. Even if you held several different jobs, you will only receive one annual income statement. If you received transitional severance pay, you will receive a separate annual income statement.
The income on which you pay tax is calculated by deducting the amounts for your pension contribution and supplementary income protection insurance from your gross salary. You will pay tax on the remaining amount. The remaining amount is lower than your gross salary.
Understanding your annual income statement
Your annual income statement contains a number of terms that can be found on your tax return. Below is an explanation of these terms:
- Salary for payroll tax/national insurance contributions: This is the amount from which your employer has withheld payroll tax/healthcare insurance contributions (wage tax and national insurance contributions). This is the amount of wages that will be entered on your income tax return.
- Withheld payroll taxes/national insurance contributions: This is the amount that your employer has withheld from your gross salary. This is the amount that will be entered on your income tax return.
- Deducted employed person’s tax credit: This is the amount of the employed person’s tax credit that your employer has deducted from the regular wage (the wage to which your employer has applied the wage tax tables)
- Deducted life-course leave tax credit: This is the amount of life-course tax credit that your employer has applied.