Income Tax Calculator


Year:
Type of Taxpayer:
Payment Type:
Gross Income ($):
        

Calculation Methodology

General Income Tax use cases for CURRENT Year of Income

  • Your Non-taxable Income is set at 65,000 per month.
  • If you earn 65,000 or less per month OR 780,00O or less per year, no Income Tax is deducted from your salary
  • NIS is NON-Taxable and is deducted before final tax is calculated
  • NIS Deductions - Explained 

Considerations for Monthly Calculations:

  • If you earn more than 65,000 per month and less than or equal to 195,000 per month, 28% Income Tax is deducted
  • If you earn more than 195,000 per month, 1/3 of the gross salary you earn is your Non-Taxable Income
  • If you earn more than 195,000 per month, your Income Tax deducted is calculated in two (2) parts:

Before the deductions are made; 1/3 of the gross amount needs to be calculated as your Non-Taxable Income, then the NIS deductions, then the following taxes:

                     1)   28% of the first 130,000 of your chargeable income is deducted and           
                     2)   40% of every dollar of chargeable income above $130,000 is also deducted

Considerations for Annual Calculations:

  • If you earn more than 780,000 per year and less than or equal to 2,340,000 per year, 28% Income Tax is deducted
  • If you earn more than 2,340,000 per year, 1/3 of the gross salary you earn is your Non-Taxable Income
  • If you earn more than 2,340,000 per year, your Income Tax deducted is calculated in two (2) parts:

Before the deductions are made; 1/3 of the gross amount needs to be calculated as your Non-Taxable Income, then the NIS deductions, then the following taxes:

                     1)   28% of the first 1,560,000 of your chargeable income is deducted and
                     2)   40% of every dollar of chargeable income above 1,560,000 is also deducted

Template to guide payroll users and vendors:  

To further assist payroll users and vendors while ensuring conformity to the above guidelines, the GRA has created some examples (see link to Microsoft Excel file below) to serve as a guide. The Excel Workbook comprises of three (3) worksheets which provide calculated values over a one-year period for three different "pays" i.e. Monthly, Fortnightly and Weekly.

The Year to Date calculations e.g. NIS, Non-taxable allowance, Chargeable Income and the taxes deducted as per the 28% and 40% tax bands are generated automatically. You can enter the Gross Income paid to an employee as per the different pays and period stated above. All other values will be automatically calculated and displayed based on the Gross Income entered.

Link to templateYTD Excel Template - 2019