How the German salary calculator works

Monthly payroll withholding, not the annual tax

The calculator reproduces the wage tax withheld under § 39b of the German Income Tax Act (EStG) for a monthly pay period. That is the figure shown on your payslip.

It deliberately does not compute the income tax from an annual tax return. In an assessment the tax office takes your actual professional expenses, special expenses and extraordinary burdens into account; payroll withholding uses the statutory flat-rate allowances instead. The annual tax can therefore differ from the sum of the amounts withheld, which is why a refund or a back payment is possible.

The full chain

1. Annualisation. The monthly wage is multiplied by twelve and projected to an annual wage.
2. Deductions from the annual wage. The employee flat-rate allowance (1,230 €), the special-expenses allowance (36 €), in tax class II additionally the single-parent relief (4,260 €), and the Vorsorgepauschale.
3. Vorsorgepauschale. The employee shares of pension, health, long-term care and unemployment insurance, each capped at its contribution ceiling; the health, long-term care and unemployment parts together are capped at 1,900 € per year. For privately insured employees the basic premium paid, minus the tax-free employer subsidy, replaces the health and long-term care parts.
4. Tariff. The tariff in § 32a EStG is applied to the taxable annual amount: basic allowance, two progressive zones, two proportional zones. Tax class III uses the splitting tariff; tax classes V and VI use the special formula in § 39b Abs. 2 Satz 7 EStG.
5. Period. The annual wage tax is converted to the month and rounded down to full euros.
6. Solidarity surcharge and church tax. Both are applied to a base that takes the child allowance into account. The solidarity surcharge is 5.5 % and is capped in the transitional zone at 11.9 % of the excess; church tax is 8 % in Bavaria and Baden-Württemberg and 9 % elsewhere.
7. Social insurance. Health, long-term care, pension and unemployment insurance are computed separately, each on the gross wage up to its contribution ceiling. Where contributions are shared equally, the half rate is applied and the rounded result doubled (§ 2 Abs. 1 BVV).

From an hourly, daily or yearly rate to a monthly salary

The calculator accepts pay in four bases: per hour, per day, per month or per year. Wage tax and social contributions are always computed from a monthly salary, because the Programmablaufplan calculates for a monthly pay period.

• Hour: monthly salary = hourly rate × (weekly hours ÷ 5) × working days in the month.
• Day: monthly salary = daily rate × working days in the month.
• Month: monthly salary = the amount entered, no conversion.
• Year: monthly salary = annual amount ÷ 12.

Working days are all Mondays to Fridays of the selected calendar month, derived from the calendar and therefore leap-year safe. Public holidays are not deducted. In a month with public holidays the calculated monthly salary from an hourly or daily rate is therefore slightly higher than the amount actually paid out. The month affects the result only for the hourly and daily bases; for monthly and yearly pay it does not change the calculation but is still reported in the result.

The conversion is rounded to two decimals exactly once, commercially. Wage tax and social contributions then follow with their own rounding rules.

Rounding

Social insurance follows § 1 Abs. 2 BVV: intermediate results are not rounded, the final result is computed to two decimals, with the second decimal increased when the third is 5 to 9. Wage tax is rounded down to full euros, and fractions of a cent are disregarded (§ 39b Abs. 2 Satz 10 EStG). The calculator uses exact decimal arithmetic internally rather than floating point, so that these rules are respected.

How it was validated

The implementation was checked against the official wage and income tax calculator of the Federal Ministry of Finance, which executes the same Programmablaufplan. Thirty persona cases were built and submitted with identical inputs to both implementations.

The test set covers tax classes I to VI, zero to five children, church tax at 8 % and 9 %, statutory and private health insurance, the special case of Saxony, Minijob, the Übergangsbereich, both contribution ceilings, the basic allowance boundary and the top tariff zone.

The Minijob is not comparable against the official calculator, because the Programmablaufplan provides no wage tax withholding for it: in a Minijob the employer pays flat-rate contributions. For that case the rules of § 8 SGB IV and § 168 SGB VI apply, and the calculator models them separately.

As an additional check, the results of two third-party calculators were compared for the same inputs. Both matched the social contributions to the cent but differed on wage tax by 3.92 €, 6.75 € and 12.34 € per month, respectively, on the high side.

Known limits and deviations

• Church tax rounding. The Programmablaufplan only supplies the assessment base. The calculator rounds commercially to two decimals. The church tax laws of the federal states may prescribe different rounding; deviations of at most one cent are possible.
• Private health insurance. The calculator expects one monthly premium for basic cover and an employer subsidy. Real tariffs separate health and long-term care parts; enter the total your employer reports.
• Children. The same number of children is assumed for the child allowance and for long-term care insurance. If your wage tax record shows a different child allowance count, the result cannot be reproduced exactly.
• Not modelled. Company pension and other benefits in kind beyond the scope above, one-off payments such as Christmas or holiday pay, severance payments, the age relief amount, short-time working allowance and other wage replacement benefits. Also not modelled: civil servants (Beamte), the self-employed and managing directors, who are subject to different rules.
• Allowances. An individual allowance registered on your wage tax record is not requested in this version. The calculator works without it and therefore tends to show slightly too much wage tax.
• Public holidays. Working days cover Monday to Friday and exclude public holidays. If you are paid hourly or daily, the monthly salary shown here can exceed what is actually paid out in a month with public holidays.
• Health insurer supplementary rate. The selectable insurers and their rates come from the GKV-Spitzenverband overview under § 242 Abs. 5 SGB V, as of 23.09.2026. Insurers can change the rate during the year; the figure on your payslip is always authoritative. The rate can therefore be overwritten manually at any time, and the selection then switches to “Manual / other insurer”.

Legal sources

Every value comes from an official source. The most important:

• § 32a EStG – income tax tariff 2026
• § 39b EStG – withholding of wage tax
• § 32 Abs. 6 EStG – child allowance
• § 4 SolzG 1995 – solidarity surcharge rate
• § 8 SGB IV – marginal employment threshold
• § 20 SGB IV – Übergangsbereich
• § 241 SGB V – general health insurance contribution rate
• § 55 SGB XI – long-term care insurance rate
• § 341 SGB III – unemployment insurance rate
• § 2 BVV – calculation of the total social insurance contribution
• Sozialversicherungsrechengrößen-Verordnung 2026 – contribution ceilings
• Federal Ministry of Health – average supplementary contribution rate 2026
• GKV-Spitzenverband – Krankenkassenliste – supplementary contribution rates of the health insurers under § 242 Abs. 5 SGB V (as of 23.09.2026)
• BMF wage and income tax calculator – official reference calculator and Programmablaufplan

The Programmablaufplan 2026 used here is published by the Federal Ministry of Finance as XML pseudocode and is the basis for the machine calculation of wage tax.

German-language version with the full parameter tables: Methodik und Quellen.

Updates

The parameters are reviewed every year, as soon as the social insurance rechengrößen ordinance, the announcement of the average supplementary contribution rate and the Programmablaufplan for the following year are available. A year is only enabled once a complete and enacted parameter set exists. Provisional or merely announced figures are never presented as settled. Every parameter set carries the date of its legal basis, which is shown in the calculator.