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Wages in Germany, Gross and net salary – everything you need to know about it

Germany. One of the first things you should know is that wages in Germany are negotiated on a gross level. If you have recently been working in Germany or are planning to move to Germany in search of work, the following information on earnings will be very important to you. As an employee in Germany, you should know the details of the salary rules, tax grades and information on your monthly payslip.

As we mentioned, one of the first things you should know is that wages in Germany are always negotiated on a gross level. This means that the amount you get in your hand will be completely different from the amount negotiated during the interview.

Why is this happening?

Because the employer will pay for you social benefits (health and pension contributions) and taxes (income tax, church tax, if you are a believer, so-called solidarity tax).

How much money you will get, whether you live alone or with your family, whether you have children or not.

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For example, a worker in Hesse, unmarried and childless, tax class 1, with a gross monthly salary of € 3,000 , professing Catholic religion, will have a net salary of around € 1,900. About 450 will be deducted for taxes and about 600 euros for social security payments. Changing the tax class, in a given case, from 1 to 3, can bring about 300 euros more in the employee’s pocket, i.e. a net salary of almost 2,200 euros. An employee belonging to the 5th tax class, on the other hand, has to take into account that out of the gross amount of EUR 3000, only half of them will be left in their pockets – around EUR 1500.

What information does the German pay slip contain?

On the payslip each employee receives each month, you will find detailed information on the employee’s pay and position:

You can find detailed deductions for various taxes and contributions under the heading “remuneration”.

In addition, the salary section includes: name and address of the employer, name and address of the employee, tax identification number, social security number, tax class, number of dependent children, possible allowances for caring for a disabled person, allowances for single persons raising children, employee bonuses, bonuses paid on the occasion of holidays or vacation, and allowances for overtime work.