Updated on March 19, 2026
Disclaimer: This summary is for informational purposes only and is not legal or tax advice. Tax rules depend on residency, income type, deductions, family status, and local filing rules. Always check the local tax authority or a qualified tax adviser before relying on these figures.
Navigating tax-free thresholds across Europe is not always straightforward. Some countries have a clear personal allowance or basic exemption. Others rely on a personal tax credit, a minimum subsistence rule, or a progressive allowance that changes with income. That distinction matters, especially for freelancers.
This list may help freelancers understand how and if they need to pay tax in their home country when using Abillio; however, it is for informational purposes only. Freelancers should always consult their local tax authority or seek professional advice before taking action.
Poland
Poland offers a clear tax-free threshold. Income up to PLN 30,000 per year is exempt from personal income tax.
Beyond that:
Above PLN 120,000 – 32% tax
Up to PLN 120,000 – 12% tax
UK
The UK maintains a standard Personal Allowance of £12,570.
This is the amount most individuals can earn before paying income tax. The allowance gradually decreases for higher earners.
Belgium
Belgium provides a tax-free allowance, meaning part of your income is not taxed.
For 2026, this amount is approximately €10,570 per year, although it may be slightly adjusted due to indexation.
Latvia
Latvia uses a progressive non-taxable minimum, not a fixed threshold.
In 2026, the maximum non-taxable amount is €550 per month (€6,600 per year).
Important:
- The allowance decreases as your income increases
- You must submit a declaration for it to apply
Estonia
Estonia updated its system in 2026.
The basic exemption is €700 per month (€8,400 per year).
Unlike previous years, the declining “tax hump” system has been simplified, making the exemption more predictable.
France
France does not use a single fixed tax-free threshold.
Instead, it applies a 0% tax band within its progressive system. The exact level is updated annually, but income roughly up to the low €11,000 range falls into this band.
Iceland
Iceland uses a personal tax credit system, rather than a traditional threshold.
In 2026, the credit is approximately:
- ISK 72,492 per month
- ISK 869,898 per year
This credit offsets tax rather than exempting income directly.
Austria
Austria applies a clear 0% tax band.
Income up to €13,308 per year is not subject to income tax.
Germany
Germany provides a basic personal allowance.
In 2026:
- €12,348 per year is tax-free for a single individual
- Double that amount applies to married couples
Portugal
Portugal uses progressive tax rates but also applies a minimum subsistence rule.
In 2026, income up to approximately €12,880 is effectively protected from taxation through this mechanism.
Some countries do not offer tax-free thresholds, but offer either flat or progressive tax rates:
Hungary
Hungary applies a flat income tax, but certain regimes include a tax-free portion.
For small business taxation schemes, income up to HUF 1,744,800 may effectively be tax-free.
This does not apply universally to all taxpayers.
Romania
Romania applies a flat 10% income tax.
While there is no standard tax-free threshold, additional obligations (such as social contributions) apply once income exceeds certain limits.
Spain
Spain does have a tax-free component, although it is not presented as a simple threshold.
The personal allowance starts at €5,550, representing income considered necessary for basic living expenses.
Why these differences matter
While it’s tempting to compare countries directly, tax-free income is calculated differently depending on the system:
- True thresholds (UK, Germany, Poland)
- Progressive allowances (Latvia, Estonia)
- Tax credits (Iceland)
- Deductions and minimum income rules (Portugal, Finland, Spain)
Final thoughts
Understanding how tax-free income works across countries helps you estimate what you’ll actually keep – not just what you earn on paper. But the key thing to remember is this: your tax obligations are determined by your country of tax residence, not where your clients are based.
If you’re invoicing clients internationally, it’s worth double-checking how your local tax system treats that income to avoid unexpected surprises.
If you’re a freelancer looking for a simpler way to invoice clients globally without setting up your own company, Abillio helps you handle the admin side of things. You can create compliant, business-ready invoices and manage your income in one place – so you can spend less time on paperwork and more time on your work.
