There are ways to increase the refund. From simple things, such as health and education expenses, to real estate renovations can be declared.
7 tips to increase your income tax refund
The deadline for submitting the 2021 income tax return ends on April 29 and refunds start to be paid on May 31 and go until September 30. And among the various doubts that arise in the midst of the declaration process, one of them is common: how to increase the amount received in the refund?
Know that there are ways to increase your Income Tax refund. From the simplest things, such as health and education expenses, to real estate renovations can be declared to help increase your income tax refund and decrease the amount of tax you pay.
Despite this, pay close attention to the details of the income tax return so you don’t miss the information declared, after all, you don’t want to fall into the fine mesh and end up without any refund. The most important thing for this is that you have all the necessary documents and vouchers at hand. What You Need to Know When E-Exporting to the Netherlands
In addition, there is also the possibility of making a draft through the IRS app before filling out the declaration, in fact – it may seem a little silly, but it is a way to ensure that you will do everything correctly when the time comes.
1. Health and Education Expenditures
What do health expenditures include? These are amounts paid, for example, in health plans, hospitals, exams, and consultations with doctors, dentists, psychologists, and physiotherapists, among others.
The amount with health expenses is deducted in full, but note that drug payments, as well as expenses with nutritionists and aesthetic treatments, are not on this list!
Education expenses, on the other hand, have a deduction limit. For 2021, the maximum amount is BRL 3,561.50, according to the Federal Revenue Service. In addition, expenditures are restricted to early childhood education; elementary School; secondary education, and higher education. What is E-Export Invoice? How to Arrange E-Export Invoice?
Extracurricular courses cannot be deducted, so courses such as English and computer courses, for example, will not serve to increase the income tax refund.
All expenses must be proven and reported under “Payments Made” when filling out the Income Tax return. It is important that the declarant keeps the receipts for up to five years, in case he has to present them to the Tax Authorities.
2. Expenses with dependents
To be able to deduct expenses with dependents from the amount paid in Income Tax, it is necessary to present all the respective incomes. If you are in doubt about whether it is really worth declaring this type of expense, do a simulation before making the IR declaration. How much does it cost to set up a Limited Company?
Who can be registered as dependents the spouses; sons; companions; country; or grandparents, among others (provided that the dependence of each one is legally proven).
This type of income tax deduction is valid only for pensions determined in court, established by means of an agreement ratified in court, or by means of a public deed – and only the amount established in the agreement is deductible!
However, if you are on the side that receives child support, not declaring children receiving child support as your dependents will increase the amount of income tax you pay. This is because those who receive the pension are subject to taxation similar to that of receiving a salary.
Thus, it is better for each child to have a separate tax return to avoid paying the Income Tax.
4. Private pension
Did you know that amounts paid to the INSS and private pension funds are also deductible from the Income Tax? Well, believe me!
But of course, this is a limited benefit for those who use the official pension or the PGBL or Fapi private pensions. And there are some rules according to the situation of each taxpayer.
Official Social Security of the Union, States, and Municipalities: Income Tax amounts are fully deducted;
Private Pension: deduction limited to 12% of taxable income for those who have PGBL (if they also contribute to the official Social Security) and Fapi. What is Private Health Insurance? How To Get Cheapest health insurance in 2022
Donations made to government institutions and funds are also tax-deductible as long as they are made during the year of the intended declaration. So if you have made or want to make donations, you can choose to donate to these government-linked locations and secure an increase in your Income Tax refund.
filing Couples who file together receive a higher income tax rate than when filing separately. This means that if you both have income, it will be better to file the IR statement separately. After all, the greater the declared income, the greater the tax calculation to be paid.
Thus, if everyone makes their own declaration, the chances of increasing the IR refund also increase considerably, as the tax rate will be lower.
7. Self-employed professionals
If you are self-employed, it is possible to deduct expenses directly linked to your professional activity, such as electricity, telephone, and even office rent (if you do not work from your own home). That’s assuming that all these expenses can be proven.
If you work from your own home, you still have the benefit of receiving up to a fifth of the total amount of home maintenance expenses, such as condominium fees and IPTU. Repairs and property recovery are not included in the deduction. What is Service Export? How to Issue a Service Export Invoice?
It is important to note that these benefits are only valid if you make a monthly declaration in carnê-leão.