Gross salary and net salary: How to navigate?
Gross salary and net salary, two concepts that can be difficult to differentiate. What is the gross salary? What is the net salary? Which do you see?
We will answer these questions.
1. What is gross salary?
The gross salary is the salary indicated on your employment contract, this salary includes various contributions such as social contributions or the various benefits granted to you. Indeed, all these costs are included in your gross salary.
Social contributions which are deductions from the salary which make it possible to finance social protection, that is to say retirement, social security, health insurance, aid for families etc.
2. What is the net salary?
Take home pay is the money you will receive at the end of the month. Unlike some European models, the net salary in France is the gross salary less social contributions.
At this time, the tax is not considered a charge.
Thus, the gross salary is a higher salary than the net salary because the latter is free of charges, this corresponds to what you cost your employer.
For its part, the net salary corresponds to the amount of money that you will receive after the deduction of all expenses. Following the implementation of the withholding tax system, income tax is deducted monthly from your net salary. The amount of tax depends on your professional and personal situation.
You now know everything there is to know about these two major concepts of salary.