Income Tax (Personal Income Tax), Wage Tax

Personal income tax is a tax levied on an individual's earnings, including wages, salaries, investments, and other income sources.

While income tax and wage tax are related, they are not always interchangeable

• Income tax is a broad term that applies to all taxable income, including wages, self-employment earnings, rental income, and capital gains.
• Wage tax specifically refers to tax withheld from an employee’s wages by the employer and paid directly to the tax authorities. It is a type of income tax but applies only to employment income.

In many countries, wage tax is essentially a prepayment of income tax, with the final tax liability determined after filing an annual tax return.