Understanding Your German Payslip — Gross vs. Net in 2026 (with Example)

"Why is my net so much less than the gross in my contract?" Every HR team hears that question every month. The answer sits in a payslip with 20+ items — and most workers don't decode it. This guide explains gross vs. net in Germany 2026, every mandatory line, the tax classes and walks through a complete sample calculation.

Gross (Brutto) is the agreed wage before deductions. Net (Netto) is what hits your bank account after taxes and social contributions.

In 2026 the difference is typically 30–45 %.

• Tax class I (single): Net ≈ 60–67 % of gross
• Tax class III (married main earner): Net ≈ 67–75 % of gross

1. Taxes

• Wage tax: Prepayment of income tax.
• Solidarity surcharge: 5.5 % of wage tax — abolished for most under €73,000 annual gross.
• Church tax: 8 % (BY, BW) or 9 % (other) of wage tax — only if member.

2. Social contributions (employee 2026)

• Employer and employee details
• Employment start date
• DOB, tax ID, SV number
• Tax class, religion, child allowances
• Health insurer + rate
• Pay month and period
• Gross breakdown
• Taxes with calculation base
• Social contributions with share
• Net payout amount and bank details
• Hours worked and leave
• Year-to-date cumulative

Breach of Verification Act: fine up to €2,000.

Marketing manager, single, no children, Protestant, 35, NRW, HV with 1.2 % additional — €4,500 gross.

Net ratio: 62 %. Total employer cost: €4,500 + ~21 % = €5,445.

Minijob (€603)

No taxes, no SV (except 3.6 % pension optional). Employer: 31 % flat-rate.

Working student

Only 9.3 % pension — no HV/LTC/UV.

Midijob (€603.01–€2,000)

Reduced rate via sliding-scale formula.

Short-term employment

Fully SV-exempt. Wage tax normal or 25 % flat possible.

• Hourly vs. monthly gross: €14/h × 40 × 4.33 ≈ €2,425/month.
• Collective vs. negotiated wage: collective is the floor.
• Benefits in kind: company car, meal vouchers — added to gross.
• 13th month: gross with special tax, balanced via tax return.

1. Why is January net lower?

SV applies to full gross without ceiling effect; new wage tax table.

2. What is the contribution ceiling?

2026 (West): HV/LTC up to €5,512.50, PV/UV up to €8,150/month.

3. Must I file a return?

Mandatory: classes V/VI, multiple jobs, self-employment. Voluntary almost always worthwhile (avg refund €1,072).

4. Wage tax vs. income tax?

Wage tax is prepayment; income tax is final after the return.

5. How can I increase my net?

Tax-class switch, allowance, cheaper insurer, occupational pension, benefits in kind.

6. What about wage garnishment?

Garnishment-free amount 2026: €1,402.28 net/month for singles.

Vardio can support hiring and worker communication, while payslip, time-recording, tax-class and social-contribution calculations should remain in reviewed payroll systems.