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What is Net Income?

Net income is the amount of money you actually receive after all taxes, social contributions and mandatory deductions have been subtracted from your gross earnings.

Net income — also called take-home pay or net salary — is the figure that lands in your bank account each month. Employers withhold income tax and social contributions (pension, health, unemployment) directly from gross pay and pay the net amount to the employee.

Net income depends on country, canton, marital status, number of children and personal allowances. In Switzerland the gap between gross and net is comparatively small (15–25%). In Germany and France it is much wider (35–45%) once social contributions and income tax are stacked up.

For businesses, 'net income' means something different: it is the profit left after all expenses, interest and taxes — the famous 'bottom line' on an income statement.

Formula
Net income = Gross income − Income tax − Social contributions − Other deductions
Example

A single employee in Zurich earning CHF 100,000 gross typically nets around CHF 78,000 per year (~CHF 6,500/month) after AHV/IV/EO/ALV and federal, cantonal and municipal taxes.

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Net Salary Calculator

Estimate your take-home pay in Switzerland, Germany, France and Italy after all taxes and social charges.

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Related terms

Frequently asked questions

Why is my net so much lower than my gross?+

Mandatory social contributions and income tax can easily reach 30–45% of gross in EU countries; Switzerland is closer to 20%.

Does net include the 13th salary?+

If you receive a 13th month, the annual gross used to compute the net should include it.

Is net income the same as disposable income?+

Disposable income subtracts further mandatory costs like rent and health insurance, leaving the truly spendable amount.