[rsaz]

Are there any countries with good, reasonable tax systems? I'm only familiar with Canada and the USA, both of which are a bit of a mess, though seemingly in different ways. I'd be very interested in hearing what the process is like in other places.

[xnorswap]

Depends on your circumstances. The UK seems reasonable for most.

For the employed, you let your employer worry about it. You might occasionally get given a "tax code" which essentially equates to your tax free allowance. If that happens you just let your employer know and they'll sort it, and you can confirm by checking your payslip.

If you're determined to have over or underpaid tax (e.g. your income went down unexpectedly), your tax code for the following year will be adjusted so that you'll end up clawing back the money over time.

Unless you are self employed or have special circumstances, then you'll avoid having to file a "self assessment" form.

And to be clear, the "special circumstances" are nothing like the US' system of hundreds of different "deductions".

Even if you do have to fill in a self assessment form, you can do so with an online form, which actually takes into account answers rather than making you manually have to do things such as "Skip section 5 if you have put a number of in section 4b or a number less than 3340 in section 2a" that the US forms love to make you do.

Filing my US taxes is literally 99% of all paperwork I have to do each year, and I don't even earn enough to actually have to pay anything. Yet I still have to calculate everything, then write down the right numbers in the "foreign earned income exclusion" boxes, then tally it all up to make sure it's still zero, then make sure I've copied the right numbers to the right boxes and haven't mistakenly transposed any numbers, then copy those zeroes down to the right boxes through the rest of the 1040.

The UK has had this system for decades, it has had online tax filing since 3 July 2000. It's had PAYE (pay as you earn tax, i.e. tax deduction at source) since 1944.

The UK feels stagnant as heck, so I wouldn't recommend people actually move here, but its tax system is trivial to the point of ignorable if you're employed.

[Tade0]

I can give you a primer on the system for independent contractors in Poland:

-Flat minimal monthly pension contribution either filed as a business expense or just deducted from gross income - subtly different, but functionally the same as long as you have income. Calculated as the pension contribution of someone making 60% of the average wage - the exact number is published on an annual basis.

-Income tax: every January you can select one of several schemes:

1. Two brackets - 17% and 32% with the first 30k PLN ($7k USD) tax-free and ability to file taxes together as a married couple, in which case you effectively average out your and your spouse's incomes and pay taxes accordingly.

2. 19% flat rate, no tax-free range, no rules like for marriages.

3. 12% flat rate, mostly same as 2., except on top of that you can't file business expenses. There a few different rates in this scheme, but IT generally falls under the group charged 12%.

Healthcare contributions depend on tax scheme chosen above and are calculated as a percentage of gross income from the previous month minus deductions and expenses.

1. - 9%, 2. - 4,9%, 3. - 3%.

That is mostly it. Regular employees have more complicated rules with employer contributions on top of gross income and small deductions like for living sufficiently far from the workplace, having an internet connection and whatnot, but they don't add up to much.

[pzduniak]

In Poland there are some complexities when you run a company / employ, but as an employee it's relatively straightforward UX where you click through a government-operated "income tax fillings wizard" and either just OK a pre-filled declaration or add a couple missing items. Paper filling is a bit more complicated, but I think you can get help at the tax office to get 1 or 2 forms sorted out.

For self-employment I send 2 documents per month regarding my expenses (which is somewhat easy if you understand the rules), plus one or two summaries per year. Hiring is a bit more complicated, I only file simplified declarations for employing private people as contractors. Otherwise I'm pretty much a worst case scenario as I file 7 different yearly declarations covering most possible sources of income defined in the law. It's not that bad, but it could be better.

Running a company can be practically automated with an online accounting SaaS, including payroll. Laws tend to be relatively understandable and there isn't much complicated math. Most of the recent confusion was around shitty laws poorly implemented and then partially reverted by our previous government. I did not enjoy that, but there were some decent online writeups explaining how to proceed.

[dkga]

Switzerland tax law is pretty straightforward and the cantonal (local government) tax authorities are known for being very helpful in explaining things to taxpayers in doubt, an experience I had more than once.

[bradley13]

I dunno, the sheer size of our personal (Swiss) tax return is daunting - and we are pretty ordinary. Maybe not as insane as the US, but "simple" would be different.

[sira04]

The Faroe Islands have the best one according to this article I read recently https://prospect.org/world/best-tax-system-on-earth-faroe-is...

[swamp_donkey]

I’ve filed a few returns in new zealand and it seemed pretty simple, I was a simple case though

[jqpabc123]

The EU has VAT (value added tax) which is added to each purchase.

At the end of the year, there is nothing to report and nothing to pay.

It doesn't get much simpler than this.

[koliber]

The original post is about income tax. While VAT is a tax, it is not an income tax.

[jqpabc123]

The post I responded to asked:

     Are there any countries with good, reasonable tax systems?

VAT is a reasonable alternative to income taxes but neither the question nor my response ever specified "income".

[ska]

Most places a VAT is not instead of income tax but instead of sales tax. Do you know of anywhere with VAT but no income tax?

[xav0989]

Many places, Canada included, have both a VAT-like sales tax and an income tax.

[Fidelix]

Not even remotely correct.

Each country in the EU has different income tax systems and other types of tax. VAT is just one aspect that generally doesn't cover even half of the tax burden.

OP is talking about the overall tax system.

[aftbit]

The EU doesn't have income tax? I think that's false.

[jqpabc123]

Neither the question nor my response ever specified "income".

[aftbit]

>At the end of the year, there is nothing to report and nothing to pay.

That is what I was reacting to. You still need to file taxes in the EU right? I know they have streamlined it a lot in most countries, but there is indeed something to report, no?

[michael1999]

Not sure what good means. Nobody likes to pay tax.

If you mean legible, common-law taxation is going to be messy by nature. Civil-law jurisdictions will be more legible. France has published formulas for theirs.

If you mean simple, Estonia deliberately chose a simplified foundation for their post-Soviet era -- a tripod of land-value tax (not a property tax); flat income tax with some basic deductions; and VAT. They are new enough that exceptions are probably modest. https://en.wikipedia.org/wiki/Taxation_in_Estonia