What's the difference between gross and net salary?

Gross is before deductions; net is what you actually receive after tax and contributions.

How do I work out net from gross?

Subtract income tax and social contributions; the exact rates depend on your country and circumstances.

Which figure should I budget with?

Net pay, because that's the money that actually reaches your account.

Gross vs Net Pay

Published 11/3/2025 · 2 min read · Finance calculators

Camille Laurent — Finance writer at OneKitly

Tax · Personal finance

Checked against 2 sources

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In short

Gross pay is what you earn before anything is taken out; net pay — your take-home — is what lands in your account after tax, social contributions and other deductions. On a $3,000 gross monthly salary you might take home around $2,300 depending on your country and situation. Gross is the headline figure in a job offer; net is what you actually live on.

Gross is what you earn; net is what you keep. Here's what comes out in between, and why you should always compare job offers on net pay.

What gross pay is

Gross pay is the full, agreed figure before any deductions — the number written in your contract and quoted in a job advert. If your salary is '$36,000 a year' or '$3,000 a month', that is gross. It is the starting point every deduction is taken from, which makes it the right figure for comparing the headline size of two salaries, but not the money you can actually spend.

What net pay is

Net pay is what actually reaches your bank account — often called take-home pay. It is the gross figure after income tax, social and pension contributions, health cover and any other withholdings have been removed. This is the number that matters day to day: the amount you can put toward rent, bills, saving and everything else. When people ask 'what do you make?', the honest answer for budgeting is the net.

What comes out in between

The gap between gross and net is made of deductions, and it varies a lot by country. The usual pieces are income tax, social security or pension contributions, and health insurance; some places add unemployment, union dues or extra levies. Together these can take anywhere from around 20% to over 45% of gross. Because the mix differs so much between countries and income levels, the same gross salary can leave very different amounts in your pocket.

Why it matters when comparing offers

Two jobs with the same gross can pay very differently once deductions bite — a higher gross with heavier tax or contributions can net less than a lower one. So when you weigh offers, or compare a role in one country with another, convert both to net before deciding. And build your budget on net, not gross: planning around the headline figure is the quickest way to overcommit on rent and repayments you can't actually cover.

Worked with our own calculator

Gross/net salary calculator

Given

Country: France
Gross annual salary: $45,000.00
Status (France): Non-managerial

Result

Social contributions: $9,378.11
Income tax: $3,068.08
Net yearly: $32,553.80
Net monthly: $2,712.82

These figures are produced by the calculator below, not typed in by hand — they are recomputed whenever the tool changes.

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Frequently asked questions

What's the difference between gross and net salary?: Gross is before deductions; net is what you actually receive after tax and contributions.
How do I work out net from gross?: Subtract income tax and social contributions; the exact rates depend on your country and circumstances.
Which figure should I budget with?: Net pay, because that's the money that actually reaches your account.

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This is general information, not tax or financial advice. Deductions vary by country and situation; check your payslip or a qualified adviser for exact figures.

Sources

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