The tax is a figure, percentage or coefficient that indicates the amount of a tax that a taxpayer must pay to the State.
The lien is used to quantify the amount that must be paid for a tax. In other words, it measures the part that goes to the public authorities.
How the lien is calculated
The tax is applied directly on the tax base to calculate the full tax. Or in the event that there is any reduction, on the taxable base.
When the tax is a percentage, it is directly multiplied by the tax rate. Therefore, the tax is calculated as follows:
Full installment = Tax base x Tax rate
In order to understand the tax, it is necessary to understand what the tax base, the taxable base and the full fee consist of.
- The tax base: It is the monetary or non-monetary amount that shows the economic capacity of the taxpayer.
- The taxable base: It is the result of practicing, in the tax base, the reductions established by Law for certain taxes or taxes. We could say that it is the net basis.
- The full installment: It is the result of applying the tax rate corresponding to the taxable base.
Example of lien
A practical example to understand what the tax is is the VAT tax. A subject buys a product that has a tax rate of 2% and the price of the product is € 100. The tax that you must pay for the purchase of this product is 2 euros, which is the full fee.
|Tax base||Payable base||Tax type||Full fee|
|€ 100||We assume there are no reductions. € 100||2%||2 €|
100 x 2% = € 2 full fee
Types of lien
The taxes will depend on the taxable base to which they are going to tax to determine the quota to be collected by the public entity.
- Specific tax or fixed amount. This type of tax is used for non-monetary tax bases. It will be taxed in amounts of money per unit of taxable base. An example of this type of tax is the tax on hydrocarbons and it is levied in euros per liter.
- Percentage or aliquot tax: The tax base on which this tax will be applied is of a monetary nature. Several types can be distinguished:
- Fixed rate: It is a proportional tax. The percentage that is applied to the base does not depend on the amount of this, but is previously set by the State. An example is the VAT tax.
- Variable rate: It is a progressive tax. The percentage to be applied will depend on the amount of the tax base. It can be divided into two classes at the same time:
- Aliquots by sections or by steps: In this case the tax base will be divided into sections and each part will be applied its corresponding percentage. Once its percentage has been applied to each tranche, the resulting quotas will be added and the result of that sum will be the tax amount to be collected by the State. An example of this type of tax is income tax or IRPF.
- Aliquots by classes or continuous: Depending on the amount of the tax base, a single tax will be taxed and the result of applying that tax to the tax base will be the tax amount to be collected by the State.
Practical example of a lien
Let’s see examples according to the type of lien:
Example of a tax by tranches
To exemplify the tax by tranches or by steps, we are going to use a subject with a taxable base (on which we are going to apply the tax) of € 43,000. The scale is as follows:
|Payable Base||Tax type|
|€ 0-€ 10,000||5%|
|€ 10,001 – € 25,000||fifteen%|
|€ 25,001 – € 45,000||twenty%|
- For the first € 10,000 you pay € 500, that is, 5% of € 10,000.
- For the second € 15,000 pay € 2,250. It is the result of 15% of 15,000 euros, which is the corresponding to the second tranche (25,000 – 10,000).
- And for the remaining € 18,000 pay € 3,600. It is the result of 20% of 18,000 euros, which is the corresponding to the third tranche (43,000 – 25,000).
- Total: € 500 + € 2,250 + € 3,600 = € 6,350
The 6,350 euros will be the full fee to be paid to the State. In this type of tax it depends on the amount of the taxable base and in addition to each tranche a different rate is applied.
Continuous lien example
To exemplify the type of continuous tax with the same subject as in the previous case (Taxable base of € 43,000) and with the same tax rate table, but in this case taking into account that it is a type of continuous tax by classes.
The subject of the example would be in the third class and 20% will be applied to the entire taxable base:
20% of € 43,000 = € 8,600
Therefore, your full fee to be paid to the State will be € 8,600.