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Book a call ↗Employer payroll taxes are the taxes and contributions a company pays on top of its employees' wages. They are separate from the income tax and employee contributions withheld from pay. In the US they are mainly Social Security, Medicare and federal and state unemployment taxes; in Europe they are the employer share of social security contributions.
They are invisible on the offer letter and very visible in the budget, which is why a US company comparing a US hire with a European one should compare employer cost, not salary. The structure also differs: US Social Security and federal unemployment tax stop at a wage base, while many European contributions run on most or all of the salary.
What a US employer pays in 2026
| Tax | Employer rate | Wage base | Source |
|---|---|---|---|
| Social Security | 6.2% (employee pays another 6.2%) | Up to $184,500 | IRS, SSA |
| Medicare | 1.45% (employee pays another 1.45%) | No cap | IRS |
| FUTA | 6.0%, usually 0.6% after a credit of up to 5.4% | First $7,000 per employee | IRS |
| State unemployment | Varies by state | Varies by state | State agencies |
Employees also pay an extra 0.9% Medicare tax on wages above $200,000, with no employer match (IRS).
How Europe compares
The European equivalent is the employer share of social security contributions. In 2026, Estonia charges employers 33% social tax plus 0.8% unemployment insurance (Estonian Tax and Customs Board). The UK charges employer National Insurance of 15% on pay above £5,000 a year (HMRC). Spain's main employer rates add up to 29.9% for a permanent contract (Seguridad Social), within a capped contribution base. Across the EU, Eurostat puts non-wage costs, mainly employer social contributions, at 24.8% of total labour costs in 2025 (Eurostat).
What it means when you hire in Europe
To employ someone in an EU country, you register there as an employer, notify social security of each new hire, and withhold and pay both shares locally (Your Europe). Contributions are paid where the employee works, not where your company is based (Your Europe). Without a local entity, many US companies use an Employer of Record or work with an independent contractor who pays their own. Put the employer cost into the fully loaded cost, or run the numbers in the US vs Europe salary calculator. How much it costs to hire a remote developer in Europe works through real examples.
This is general information, not legal or tax advice. Rules differ by country and change, so confirm your case with a local lawyer or accountant.
Euro Remote Talent runs searches across Europe for a flat $6,500, with a shortlist of three vetted candidates in 21 days and a 12-month replacement guarantee, through Hiring Done For You. If you would rather run the search yourself, a job post is $299, live for 60 days, and the fee is credited in full if you later move to the done-for-you service.
