personfradrag

Personfradrag is a standard tax deduction used in Nordic income tax systems to reduce an individual's taxable income. It is not a direct tax credit; rather, it lowers the tax base on which income tax is calculated, thereby reducing the total tax owed.

The purpose of the personfradrag is to acknowledge basic living costs common to most earners. The amount is defined by the national tax authority and is typically set for the tax year. It may be adjusted for factors such as residency status and, in some systems, age. In practice, the deduction is often applied automatically in the payroll process for employees, and it can also be claimed when filing a tax return for other types of income.

How much personfradrag a taxpayer can claim depends on national rules and personal circumstances. In many cases, the deduction applies to all residents with taxable income, with some systems allowing adjustments for non-residents or for those with certain types of income. The deduction interacts with other tax deductions and credits, and the total tax payable is calculated on the remaining taxable income after applying the personfradrag.

An important implication is that the deduction reduces taxable income rather than tax owed directly, and it cannot be claimed twice or transferred between individuals. Because the rules and amounts are revised annually, taxpayers should consult the relevant tax authority or guidance for the current year to determine the exact entitlement and application.