As taxpayers increasingly encounter income tax refunds lower than in previous years, the government has taken to social media platforms to explain the variability in tax adjustments this year.
“With the start of the 2024 income tax campaign, some taxpayers are experiencing a tax settlement lower than usual or even facing the need to pay additional tax,” stated the government in a press release.
Why is there a tax adjustment?
The government explains that the tax adjustment “occurs because, throughout the year, employees prepay taxes monthly through withholdings at the source.”
“The actual income tax owed is determined the following year, considering income, personal and family status, and applicable deductions for each taxpayer. Once the total tax is calculated based on all income and applicable deductions, the total tax due is adjusted with the tax already prepaid through withholding,” the statement elaborates.
Therefore, “with the reduction of withholdings that occurred in 2024, the final tax adjustment will be smaller in most cases. This means that if a taxpayer has paid less tax throughout the year, there will be less excess tax to be refunded.”
In a post shared on Instagram, the government provides examples illustrating this impact. See them below:
