German payslip (Lohnabrechnung) explained: from gross to net

Who needs it

Every employee gets a Lohnabrechnung (payslip), usually as a PDF or through an online portal. It is worth reading, especially the first one. Wrong tax data, a wrong health insurer or a missing child entry all show up here first.

What you need

To check the top of your payslip, have these at hand:

• Your tax ID and your tax class
• Your social security number (Sozialversicherungsnummer)
• The name of your health insurer
• Your contract, to compare gross salary and hours

How to read it

1. Personal data block

At the top you'll find your Steuerklasse (tax class), Kinderfreibeträge (child allowances), Konfession (church membership), your health insurer and your social security number. If any of this is wrong, your deductions will be wrong too. Tell your employer's payroll team.

2. Gross pay (Brutto)

Brutto is your salary before deductions. It includes base pay plus any bonuses, overtime or allowances. Some items are tax-free or free of social insurance, and are marked that way.

3. Tax deductions (Steuern)

• Lohnsteuer (wage tax): income tax withheld monthly, based on your tax class. The final amount is settled in your tax return.
• Solidaritätszuschlag (solidarity surcharge, "Soli"): 5.5% of the income tax, but only once your annual income tax goes above €20,350 (single) or €40,700 (married, joint). Most employees pay none.
• Kirchensteuer (church tax): only if you are registered as a member of a church that collects tax, such as the Catholic or Protestant church. It is 8% or 9% of your income tax, depending on the state. You declared this at your address registration.

4. Social insurance deductions (Sozialversicherung)

Social insurance is mandatory for normal employees. The contributions are mostly split between you and your employer.

• Zusatzbeitrag (additional contribution): each public health insurer sets its own. The 2026 average is 2.9%. It is also split in half.
• Childless surcharge: if you are 23 or older and have no children, your care insurance rate rises to 4.2%. You pay the extra part alone. Parents with several children under 25 pay less.
• Saxony splits care insurance differently, so employees there pay a larger share.
• Contribution ceilings: contributions stop growing above a salary limit. In 2026 this is €5,812.50 per month (€69,750 per year) for health and care, and €8,450 per month for pension and unemployment insurance.

5. Net pay (Netto) and payout

Netto is gross pay minus taxes and social insurance. Sometimes there are more deductions after that, such as a company pension (betriebliche Altersvorsorge), a job ticket or capital-forming payments (vermögenswirksame Leistungen). The final line, Auszahlungsbetrag (payout amount), is what reaches your bank account.

6. The employer's share

Your employer pays its half of social insurance on top of your gross salary, plus some levies only employers pay, such as accident insurance. This is usually not on your payslip, or appears as information only. Your cost to the company is higher than your gross salary.

What happens afterwards

At the start of the next year, your employer sends your annual figures to the tax office. You receive a Lohnsteuerbescheinigung (annual wage tax statement). You need its numbers for your tax return. Keep your payslips. They also count as proof of income for landlords, banks and immigration offices.

Common problems

Why is my first net salary lower than expected?

The most common reason is a temporary tax class VI, used because your employer did not yet have your tax ID. Other reasons are a pro-rated first month or a missing child allowance. Overpaid tax comes back through the tax return.

Why do I pay church tax? I'm not religious.

You are probably registered as a church member, perhaps from a baptism or what you entered at your address registration. To stop paying, you must formally leave the church at the local office responsible. The rules and fees vary by state.

I'm childless under 23. Do I pay the surcharge?

No. The childless surcharge only applies from age 23.

Can I get my pension contributions back when I leave?

Sometimes, for non-EU citizens after leaving. See pension refund.

How can I estimate my net salary?

Start from your gross salary. Subtract roughly half of each social insurance rate above, then the wage tax for your tax class. Your employer's payroll team or the tax office can explain any line you don't understand.