How is the wage and salary accounting done?

Most people never look closely at their payroll. Most of the time, there is only a brief check to see whether the salary is correct and the final payment to the checking account is taken. Then the payroll disappears in the folder.

But it is important to go through the statement at least once a year. What are the social contribution rates in 2021? Here you will find all the important information you should know about payroll.

What is a payroll?

A pay slip is a document that lists the components of an employee's wages or salaries in a certain period of time. With the help of the pay slip, both employees and employers can see that the salary has been paid.

The payroll is the generic term and summarizes the payroll and payroll.

With their regular contributions, insured persons can at least save tax. This is particularly easy if the expenses are professional. But the costs of private policies can also often be deducted.

Difference Between Payroll and Payroll

Employers can reward their employees in two ways: through wages or salaries. At thewage the employee is paid according to the number of hours worked - the final amount can vary accordingly on a monthly basis. Thesalary in turn, is a fixed sum that is paid monthly. How long the employee actually worked does not matter.

Structure and content of a payroll accounting

In the trade regulations (GeWo) in §108 paragraph 1 are all information that must contain a pay slip. This includes both general information on the employee and individual remuneration components. They are listed in the order that you can find on your pay slip.

Payroll header

  • Name and address of employer
  • Name, address and date of birth of the employee
  • Insurance number, tax class and employee tax ID
  • Start and, if applicable, end of employment
  • period of the certificate

Main part of the payroll

  • Gross wage or salary
  • Benefits in kind or benefits in kind
  • capital accumulation benefits
  • if applicable, contribution to company pension scheme
  • Tax allowances
  • possibly church tax deduction
  • Employee's social security contributions
  • Personal prints
  • Expense allowances
  • Payout amount

Final part of the payroll

  • Employee account details
  • Total amount paid by the employer
  • Statement of earnings
  • Possibly a note that the billing was created in accordance with Section 108, Paragraph 3, Clause 1 of the Trade Regulations

Is the employer obliged to draw up a pay slip?

Yes, in §108 of the trade regulations (GeWo) it is legally stipulated that the employer must issue a wage statement in text form to each of his employees.

Social contribution rates in the payroll 2021

insuranceContribution rate in percentShare of employers in percentShare of employees in percent
Health insurance
- general contribution rate14,6%7,3%7,3%
- reduced contribution rate14%7%7%
- average additional contribution rate1,3%1,3%
Pension insurance18,6%9,3%9,3%
unemployment insurance2,4%1,2%1,2%
care insurance3,05%1,525%* 1,525%*

* Saxony is the only federal state to have a different regulation for the contribution rate for long-term care insurance. Here the employee share is 2.025 percent and the employer share is only 1.025 percent.

The gross salary is reduced by the wage tax. Their amount depends on the tax class to which you are assigned. How many tax brackets there are and what the allocation means for taxpayers in 2021.

by Chantal Forßmann, Ben Mendelson

Difference between gross and net

TheNet salary is the salary (wage) that remains after deducting taxes and social security contributions: net wage = gross wage - taxes - social contributionsnet is therefore always the tax-adjusted version from the point of view of the beneficiary, whileGross still has to be adjusted for taxes and social security contributions. With WirtschaftsWoche's gross-net calculator, you can calculate the exact net salary.

From gross to net: an overview of the various wage tax brackets

The income tax bracket affects how much tax is deducted from your salary. In total, a distinction is made between six different tax classes. For each tax bracket there is a monthly tax-free wage (msA).

  • Income tax class 1 (I): Single persons who are single, unmarried, divorced or widowed (msA: up to 1,029 euros)
  • Income tax class 2 (II): Single parents with at least one minor child (MSA: up to EUR 1,225)
  • Income tax class 3 (III): Married, widowed or same-sex partnerships; is only possible in combination with tax class 5 (msA: up to 1,952 euros)
  • Income tax class 4 (IV): Married or same-sex couples who have both chosen tax class 4; pays off for partners who earn roughly the same income (msA: 1,029 euros)
  • Income tax class 5 (V): Married or same-sex couples where the partner has tax class 3. The partner with the lower income chooses tax class 5 (msA: 107 euros)
  • Income tax class 6 (VI): Individuals (single, married, same-sex) with two or more jobs, e.g. marginal employment (the second job is always accounted for with income tax class 6); An income tax card is required for each job (msA: 0 euros)

© Handelsblatt GmbH - All rights reserved. Acquire usage rights?