How does someone pay alimony on their gross salary if they are employed by someone else? Suppose the partners agree on giving half of the gross monthly salary as alimony. If said person has X gross income per month which is taxed before having it in their bank account, how can they first pay X/2 to their ex-partner and then be taxed on the remaining X/2? Do they have to wait one year to claim the alimony as costs in their tax return or can they tell the tax office right away so that each month they are taxed on X/2? The countries I am concerned are Netherlands and Belgium, but insight from other places is also welcome.
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1 Answer
TLDR version:
In the Netherlands you can request a "provisional assessment" (voorlopige aanslag) for your income tax and the tax authorities will pay you back your expected tax return in advance, typically in monthly instalments.
conditions apply
As far as I understand for the Netherlands:
Your salary and other renumeration / benefits are an agreement between you and your employer.
The employer is required to withhold any and all applicable payroll/wage taxes, as well as social security contributions etc. based on your salary/benefits/renumeration package and pays those directly to the tax authority.
As the employee you should get a payslip detailing what payroll taxes, social security and/or other contributions are withheld from your gross salary/benefits/renumeration package that period and whatever amount remains is typically payed directly into your personal bank account by your employer.
Certain expenses, such as alimony payments to an ex-partner, are tax deductible.
You don't report those to your employer and even if you would do so, that won't change the amount of payroll taxes your employer is required to withhold.
You report those tax deductible expenses to the tax authorities when you file a tax return (in the Netherlands you're not always automatically required to file a tax return but when you make tax deductible alimony payments you should probably always do so).
You file your (final) tax return after the fiscal year has been completed, as only then all amounts will be final and only then picture is complete. After your tax return has been assessed, processed and approved, the tax authorities will pay back the excess taxes that were collected in advance as payroll taxes (or alternatively, your circumstances and tax return filing might require that you pay some additional taxes.)
When you make substantial tax deductible alimony payments, typically the tax return will be substantial.
The Dutch tax authorities appreciate that not everybody can afford to pay all their tax deductible expenses now and then wait for the fiscal year to end and then wait some more before their tax return filing has been processed, a final assessment has been made and their their tax return gets paid out.
That why in the Netherlands you can request a "provisional assessment" (voorlopige aanslag) for your income tax and the tax authorities will pay you back your expected tax return in advance, typically in monthly instalments.
That means you don't have to wait for 2024 before you can file your 2023 tax return and wait while your tax return gets been assessed, processed and approved. You will get (most) your 2023 tax returns paid in 2023 rather than somewhere mid/end 2024.
Then in 2024 you will make final 2023 tax return, which will determine the actual amount of income taxes that are due. Your final tax returns will take into account the advances that you already received and result in a smaller final tax return or possibly a payment if you received to much in advance returns.
