Almost every salary you will ever be quoted is a gross figure. It is the number in the job advert, the number in the offer letter and the number people give each other at dinner parties. It is also a number that nobody is ever paid.
Net salary is the amount that clears into your account. The distance between the two is not a rounding error. On a mid level European salary it routinely runs from a quarter to nearly half of the headline figure, and the size of that gap varies far more by country than most people expect.
Gross salary: the number in the contract
Gross pay is your total contractual salary before anything is removed. In most countries it includes base pay plus anything contractually guaranteed: shift allowances, a fixed thirteenth month payment, London weighting, a regional supplement. It usually excludes discretionary bonuses, overtime that has not yet been worked, and anything the employer pays on top of your salary rather than out of it.
That last distinction matters more than it looks. Employer social contributions, employer pension matching and payroll taxes are all real costs of employing you, but they never appear in the gross figure and are not yours to allocate. In some systems they are larger than everything deducted from the employee side.
Net salary: the number in the bank
Net pay is what survives the deduction stack. Four things typically come off, though not every country uses all four:
- Income tax. Charged on a progressive scale in almost every country on this site, and withheld at source by the employer in all of them except a handful where an annual return does the reconciliation.
- Social insurance contributions. Pension, unemployment, healthcare and long-term care, usually charged as a percentage of gross with a ceiling above which they stop.
- Mandatory savings. Not tax at all in the strict sense, but deducted with the same force. Singapore's CPF and New Zealand's KiwiSaver both work this way.
- Local or regional levies. Municipal tax in the Nordics, communal surcharges in Belgium, cantonal tax in Switzerland, inhabitant tax in Japan.
The same salary, ten different answers
Here is a gross salary of 60,000 euros run through ten euro denominated systems on 2026 rates, single filer, no children, no company pension. The salary is identical in every row. Only the tax code changes.
The spread from top to bottom is 690 euros a month, or 8,285 euros a year, on a salary that never changed. Anyone comparing two offers across a border without doing this arithmetic is comparing the wrong numbers. The full ranking across all twenty two countries, including the non euro systems, is set out in 60,000 euros through 22 tax systems.
Why the gap moves around so much
Three structural features explain most of the variation, and none of them is the headline tax rate.
Where the contributions stop
Belgium charges 13.07% social security on every euro of salary with no ceiling at all. Germany stops charging health and long-term care above 66,150 euros and pension above 90,600. At 60,000 euros the two look similar. At 150,000 they do not, because the German deduction rate falls as salary rises while the Belgian one does not.
What the tax is charged on
Germany, Austria, Spain, Italy and Belgium all deduct social contributions before income tax is calculated, so the contributions shelter part of the salary from tax. France allows a flat 10% professional expenses deduction on top. Ireland charges income tax on the full gross and then subtracts fixed credits at the end. These are not cosmetic differences: the same nominal rate produces materially different bills depending on which base it lands on.
Credits versus allowances
A tax free allowance is worth more to a high earner, because it removes income that would otherwise be taxed at the top rate. A tax credit is worth the same to everybody. Ireland, the Netherlands, Israel and Italy lean on credits; Germany, Austria and the UK lean on allowances. It is one of the reasons Irish take-home looks generous at 60,000 euros and considerably less so at 100,000, a shift explained in detail in the guide to Ireland's USC.
Some deductions are not really tax
Three of the systems on this site remove money from your payslip and then give it back to you later, which makes a straight net comparison misleading.
- Singapore CPF. 20% of ordinary wages up to the monthly ceiling, paid into your own retirement, housing and medical accounts. It reduces cash in hand and increases net worth at the same time, which is why CPF distorts every Singapore comparison.
- Australian superannuation. Paid by the employer on top of salary at 12%, so it never appears as a payslip deduction at all, but it is unambiguously part of the package.
- New Zealand KiwiSaver. Opt out rather than compulsory, defaulting to 3% of gross with an employer match.
German and French pension contributions are technically the same idea, but they buy an entitlement in a pay-as-you-go state scheme rather than a balance with your name on it. Whether you treat that as saving or as tax is a judgement call, and it changes any cross-border comparison by several percentage points.
The comparison most people get wrong
Net pay on its own answers a narrower question than most job seekers think they are asking. Three things sit outside it entirely.
The first is the employer side. Sweden funds a large part of its welfare state through a 31.42% employer contribution that never touches the employee payslip, which is why Swedish net pay looks unexpectedly reasonable for a country with that reputation. That mechanism is unpacked in the guide to employer contributions.
The second is the number of payments. A salary of 60,000 euros in Austria, Spain, Portugal or Greece is often paid across fourteen instalments rather than twelve, and in Austria two of those are taxed at 6% rather than at your marginal rate. How the thirteenth month is treated changes the annual figure, not just its distribution.
The third is what the deductions buy. A German payslip includes health insurance for the whole household. An American one at the same nominal net figure usually does not, and the family premium that follows is not a small line item.
Checking a figure before you sign
- Confirm whether the quoted salary is annual or monthly, and across how many instalments. Twelve versus fourteen is a 16.7% difference in monthly cash.
- Confirm whether it is gross of employer contributions. In some markets, notably parts of eastern Europe and much of Latin America, recruiters quote the full employment cost.
- Run the gross through a calculator built on the actual current year rates rather than assuming a headline percentage.
- Add back anything the employer pays on top: pension matching, superannuation, health cover, transport allowances.
- Only then compare, and compare monthly rather than annually, because that is the number your rent is paid out of.
Run any gross salary through the UK Salary Calculator or the Germany Salary Calculator and every deduction is listed on its own line. The method behind each figure is set out in how we calculate.
Related: Double Taxation Agreements