Calculating net salary from gross, formula and quick method

In 2024 the rules for calculating the net salary from the gross will change.
Thanks to the contribution relief and the new tax rates desired by the legislator to cut the tax wedge, i.e.
the difference between gross and net.
Knowing the steps for calculating the net salary amount, knowing the gross, is very important.
For example, it is useful when during a job interview a certain Ral (gross annual salary) is proposed without going into detail on how much is net in the pay slip.
In this regard, there are two ways to calculate the net salary from the gross annual income: one is quick, but is only useful for getting an approximate idea; the other is more complicated, but returns a much more precise result.
In this guide we will talk about both, starting from the simplest and then going into detail about the individual steps required by the more complex (but precise) one.
Calculating net salary from gross The quick method to calculate the net salary Calculating the net monthly salary starting from the gross: the factors to consider The elements explained How to calculate the net salary starting from the gross: the formula The quick method to calculate the net salary If you don't want waste time on more or less complex calculations and look for a quick and simple formula to exit a job interview with clear ideas in your head, you could adopt a simple approximate calculation, subtracting between 25% and 40% from the gross, or, overall, the expression of the legal withholdings payable by the worker to be paid for Irpef, INPS and other items.
By virtue of what is expressed above (especially given the progressive nature of Irpef), a higher percentage will be estimated the higher the total amount of compensation over the year.
For example, for a salary of 40 thousand euros we recommend removing 40%, while with a Ral of 20 thousand even 25% can be corrected.
As anticipated, however, this calculation returns an approximate figure, without taking into account, for example, whether particular bonuses are due on the pay slip, such as the reliefs that will remain in force throughout 2024.
Calculation of net monthly salary starting from the gross: the factors to consider What are the factors to consider to correctly calculate the net salary starting from the gross? They are different and, depending on the circumstance, these can cause the net amount of the compensation or salary to vary in relation to the gross amount.
In detail, it is necessary to consider: Total amount of the annual gross (Ral), from which a different average Irpef rate will derive.
Irpef is in fact a progressive tax.
Irpef deduction from employment due in relation to the total annual income, another element of the progressivity of the Irpef.
Deductions due for dependent family members directly on the pay slip; Rate applied by the pension fund you belong to.
In fact, not everyone accumulates their pension with INPS, as there are many other pension funds.
The rates for regional and municipal surcharges vary depending on where you live.
The right or not to supplementary treatment, also known as ex Renzi bonus.
To get an idea of what the net salary will be, therefore, it is necessary to delve into the aforementioned elements point by point, so as to arrive at a figure more or less close to that expected on the pay slip.
The elements explained We have a gross salary: we need to understand how much it corresponds to net.
What to do? Simple, you need to subtract from this amount all the taxes due and the related contribution payments.
Irpef Let's start with Irpef, the personal income tax, a type of direct, personal, progressive and general tax.
As anticipated, the rates – with the related brackets – were modified from 1 January 2024, with the result which is summarized in the following table.
IRPEF 2024 INCOME IRPEF RATES 2024 1st bracket up to 28 thousand euros 23% 2nd bracket from 28,000 to 50 thousand euros 35% 3rd bracket over 50,000 euros 43% This is a progressive tax: this means that the rate indicated it applies only to the portion of income that falls within that bracket.
Let's take an example by taking into consideration a Ral of 35,000 euros, with a gross salary therefore of 2,000 euros per month (since the annual salary is calculated on thirteen monthly payments, except for those who receive the fourteenth).
It means that on the first 28,000 euros an IRPEF withholding tax of 6,440 euros (23%) is applied, while on the subsequent 7,000 euros a further 2,450 euros are applied.
In total, the Irpef withholding – considering only the income from work – applied directly to the paycheck is equal, net of deductions, to 8,890 euros, therefore approximately 683 euros less from each single paycheck.
read also Irpef rates 2024 and new brackets: what changes for calculation and deductions Irpef deductions for employees As anticipated, however, there is the possibility of reducing the Irpef amount due on the gross salary by benefiting from some tax deductions directly on the pay slip.
The most important is the deduction recognized for employed work, also reformed from 1 January 2024 as a result of the innovations introduced by the latest budget law.
The formulas for calculating deductions for employee income are summarized in the following table.
INCOME (EURO) AMOUNT OF DEDUCTION (EURO) up to 15,000 1,955 euros due to the expansion of the No tax Area beyond 15,000 up to 28,000 1,910+1,190* (28,000-income)/(28,000-15,000) from 28,000 to 50,000 1,910* (50,000-income)/(50,000-28,000) over 50,000 0 Let's go back to the previous example, with a worker with a Ral of 35,000 euros who therefore falls into the second bracket.
For this reason the deduction is calculated as follows: 1,910* (50,000-35,000)/(50,000-28,000) It follows that the annual deduction is equal to approximately 2,203 euros: therefore, the IRPEF actually due is 6,687 euros, 514 euros on each salary (and thirteenth).
read also Employee deductions 2024, how the calculation changes Dependent family deductions Other deductions recognized in the pay slip, upon request of the worker, are those due to so-called dependent family members.
Please note that family members who in the reference year had a total income equal to or less than 2,840.51 euros are considered fiscally dependent family members.
Only in the case of children aged between 21 and 24, are they considered dependent if their income is below the threshold of 4,000 euros.
In light of the innovations introduced with the Single Allowance for Dependent Children, the deductions for dependent family members in force in 2024 are as follows.
Family member Ral workerDeduction Spouse or part of civil union not exceeding euro 15,000 800 – [(110 * total income) /15,000] Spouse or part of civil union from euro 15,001 to euro 29,000 690 Spouse or part of civil union from euro 29,001 to euro 29,200 700 Spouse or party to civil union from euro 29,201 to euro 34,700 710 Spouse or party to civil union from euro 34,701 to euro 35,000 720 Spouse or party to civil union from euro 35,001 to euro 35,100 710 Spouse or party to civil union from euro 35.1 01 to euro 35,200 700 Spouse or party to civil union from euro 35,201 to euro 40,000 690 Spouse or party to civil union from euro 40,001 to euro 80,000 690 * [(80,000 – total income) / 40,000] Spouse or party to civil union over euro 80,000 0 Dependent child over 21 Indifferent 950 euros, to which 200 euros are added for each child with more than three dependent children, plus another 400 euros in the case of a child with a handicap Other family members, if entitled to them Indifferent 750 euros Applying the following deductions, therefore, the Irpef withholding applied to the net salary will be further lowered, thus guaranteeing a higher net salary.
Supplementary treatment: Irpef bonus (formerly Renzi) From 1 January 2022, as a result of the tax reform, only for total annual incomes between 8,174 and 15,000 euros (instead of 28,000 euros) is a supplementary treatment entitled to, which is added to the net amount 1,200 euros per year.
100 euros per month, therefore, on every salary (excluding the thirteenth).
Between 15,000 and 28,000 euros, however, the remodulated supplementary treatment is due only in the presence of certain conditions, as this presupposes an insufficiency of the gross tax with respect to certain categories of deductions listed in the new art.
1 of Legislative Decree n.
3/2020.
read also Renzi bonus on the pay slip, new calculation rules.
What changes in 2024 Share of contributions to be paid by the worker The share of social security and welfare contributions payable by the worker is then applied to the gross salary, which varies based on the type of employment relationship: it is equal to 9.19% of the gross salary in the sector private and 8.80% in the public sector.
In total, also taking into account the share paid by the employer, it generally reaches 33%.
However, for 2024 it is also necessary to consider the relief applied, with related updated rates: 2.19%, 1.80% in the public sector, for workers with a pay slip of up to 1,923 euros; 3.19%, 2.80% in the public sector, for workers with a paycheck greater than 1,923 but less than 2,692 euros; zero, up to 3,000 euros per year, for women with at least two children of which at least one is under the age of 10, or with at least three children and at least one minor.
On the portion that exceeds 3,000 euros, however, the rate usually envisaged based on the type of employment is applied (this is the so-called mother's bonus on the pay slip).
How to calculate the net salary starting from the gross: the formula Once everyone has been included the elements that affect the calculation of the net salary, we can summarize the procedure by making it as simple as possible.
First of all we have to get to the taxable income, which is obtained by subtracting from the gross salary the share of INPS contributions paid by the employee which, as seen above, are equivalent depending on the case to 8.80% or 9.19% of the Ral (net of related reductions).
At this point we need to see what the gross tax is, which can be arrived at by calculating the Irpef due based on the reference income brackets and adding the additional regional and municipal Irpef.
To arrive at the net tax, however, the relevant deductions must be subtracted from the gross one, understood as the sum of the employee deduction plus any deductions for family dependents.
At this point, the net salary is given by the following formula: (Taxable income – Net tax) + supplementary treatment It must be said that even by applying the above formula it is not guaranteed that a precise net amount will be arrived at, also because there are other variables which, depending on the type of employment and contract, they could affect the net salary.