Filenews 18 March 2023 - by Eleftheria Paizanou
The refund of the lump sum tax to state employees, who retired in 2022, has begun, as part of the implementation of the new pension plan, which was approved last year by the Plenary of the Parliament.
This is the amount that was cut off from the Tax Department for the purposes of taxing the lump sum. As is known, as part of the implementation of the new pension plan, the tax-free lump sum will be given retroactively to those who retired after 1 January 2021. According to the legislation, the tip/lump sum is tax-free retroactively from January 1, 2021 for the existing state pension scheme but also for similar pension plans in force in the wider public sector.
That is, for those employees in the public and wider public sector who retired from January 2021, the lump sum they received was taxed. And this is due to the implementation of the legislation, according to which from 2013 onwards the lump sum is taxed with income tax.
According to the new pension plan, as of January 1, 2021, the taxation of the gratuity was terminated, which is why the Tax Department began to return it to those who paid it. It should be noted that the tax refund will apply to employees who left the State in the last two years, i.e. in 2021 and 2022.
According to information from "F", last week the employees of the state machine received an e-mail from PASYDY, informing them that as of March 10, the Tax Department began the refund of the lump sum tax. The competent department has already made remittances to the bank accounts of the beneficiaries.
In relation to employees in the public and wider public sector who retired in 2021, as stated in the e-mail, the Tax Department should first clear their tax return for the tax year 2021. It is worth mentioning, according to the estimates of the competent department, the clearance of tax returns is expected to be completed in 2023. PASYDY, informing those affected, notes that this procedure should be applied as taxpayers have already submitted the tax return for 2021.
