Gross vs net salary in Estonia: where the money goes
Your contract states a gross salary, your bank account receives the net, and the employer pays yet a third amount. Here is a concrete example of how the three numbers relate and where the difference goes.
Updated: 2026-07-08
Three numbers, one salary
Gross is the amount agreed in the contract before taxes. Net is what lands in your account after withholdings. The total employer cost is gross plus employer taxes - what your job actually costs the company.
What is deducted from the gross?
Three payments are withheld from an employee's salary in 2026.
- Unemployment insurance: 1.6% of gross.
- Funded pension (pillar II): 2% (optionally 4% or 6%).
- Income tax: 22% on the amount above the 700 € monthly basic exemption.
Example: 2000 € gross
Take a 2000 € gross salary with the 700 € exemption and 2% pension. Unemployment insurance 32 €, pension 40 €, income tax 270.16 €. Net salary: 1657.84 €. The employee-side tax burden is about 17%.
The employer adds 33% social tax (660 €) and 0.8% unemployment insurance (16 €). Total cost: 2676 €. The 1657.84 € reaching your account is only 62% of that.
Why do contracts always state the gross?
The net depends on your personal settings: whether the exemption application is filed, your pillar II rate, pension age. Two people with the same gross can have nets tens of euros apart. So negotiate in gross and compute your own net.
Calculate your salary in any direction
Our salary calculator works in any direction: enter gross, net or employer cost and the other two are computed automatically. Years 2023-2026, every setting adjustable.