2023 German Social Security Calculation Adjustments
Starting in 2023, German social security calculation adjustments will impact employees and employers alike. The changes are centered around calculating social security contributions, which will be based on gross salary rather than net income. Employing companies will be responsible for paying half of the contributions, while employees will pay the other half.
An Overview for Employers
Michael Stache of Profion, Asinta’s employee benefits consulting Partner in Germany, says, “The pre-tax contributions that are possible via salary sacrifice have increased due to the increase of the social security threshold.” €584 per month is now tax-free, which equals 8% of the social security ceiling threshold.
Profion condensed the most salient points for employers to know in the table below.
|
Contributions 2023 |
Employee | Employer |
Social Security Contribution Ceiling |
| Tax deductible within certain limits | Tax deductible | West Germany only | |
| State pension system
(retirement, survivors, LTD) |
9.3% |
9.3% |
€87,600 (€84,600 in 2022) |
| Unemployment |
1.3% (1.2% in 2022) |
1.3%
(1.2% in 2022) |
€87,600 (€84,600 in 2022) |
|
Health insurance |
7.3% | 7.3% |
€59,850 |
| Long-term nursing care |
1.525%-2.375% |
1.025%-1.525% |
€59,850 |
| Industrial injury/ Workers’ comp. |
0% |
0.6%-2% |
|
|
€59,850 (19.325%-20.175% in 2022) |
€59,850 (19.525%-2.375% in 2022) |
If you need local expertise for your employee benefits in Germany, don’t hesitate to get in touch with Asinta, and we’ll introduce you to Profion.