On this page
Start your hiring
Book a free discovery call. We map the role, set your budget, and start sourcing pre-vetted European talent.
Book a call ↗Net pay is what an employee actually takes home: gross pay minus income tax and the employee's own social security contributions. Eurostat uses the same definition, and calculates net earnings for several household types because tax depends on family situation (Eurostat).
For a European professional comparing offers, net pay is the number that matters. For a US employer, it explains why the same gross salary means very different take-home pay from one country to the next.
Gross to net to employer cost: a UK example
Take a £60,000 salary in England for 2026/27, using HMRC's published rates and thresholds (HMRC), before pension and any other deductions:
| Line | Amount | How it is calculated |
|---|---|---|
| Gross pay | £60,000 | Annual salary |
| Income tax | £11,432 | 20% on £37,700 above the £12,570 allowance, then 40% on the remaining £9,730 |
| Employee National Insurance | £3,210.60 | 8% from £12,570 to £50,270, then 2% above |
| Net pay | £45,357.40 | About 76% of gross |
| Employer National Insurance | £8,250 | 15% above £5,000 |
| Employer cost | £68,250 | Gross plus employer National Insurance |
In this example, tax and contributions take about 33.5% of what the employer spends, close to the OECD figure for the UK below. Pension contributions and other deductions the employee agrees to, such as salary sacrifice, would lower net pay further, and Scotland's different income tax bands would change the result.
How much of labour cost reaches the employee
The OECD measures this with the tax wedge: the gap between the employer's labour cost and the employee's take-home pay. For a single worker on the average wage in 2025 (OECD Taxing Wages 2026):
| Country | Tax wedge |
|---|---|
| Germany | 49.3% |
| Estonia | 42.6% |
| Spain | 41.4% |
| Portugal | 39.3% |
| Poland | 35.0% |
| United Kingdom | 32.4% |
| United States | 30.0% |
| OECD average | 35.1% |
What it means when you hire in Europe
Talk in gross annual figures, and let candidates work out net pay for their own situation. The jobseeker calculator does this for professionals weighing a remote offer. On the employer side, the gap between gross and cost is covered in employer payroll taxes and social security contributions. If the person works as an independent contractor, they handle their own tax, and net pay depends on their local rules.
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.
