Gross salary in Latvia in 2026 is pay before taxes; net salary is what the employee receives after 10.5% social contributions and 25.5% income tax. Gross EUR 1,750 gives net EUR 1,307.11 (VID, verified 13 August 2026).
Gross salary is the figure written in the employment contract and shown at the top of the payslip. Two deductions are taken from it in sequence, and what remains is the net salary.
The first deduction is the employee's state social insurance contributions (VSAOI) at 10.5% of gross (VID, verified 13 August 2026). An employee who has reached pension age pays 9.25% instead.
The second deduction is personal income tax (IIN). It is not calculated on the whole gross figure, but on what is left after VSAOI has been taken out and after the tax-free allowance of EUR 550 per month and EUR 250 per month for each dependant (VID, verified 13 August 2026). The rate withheld in monthly payroll is 25.5%.
The tax-free allowance and the dependant allowance apply only if the payroll tax book has been filed with this employer. Without it, income tax is charged on the full amount after VSAOI and the net figure is lower.
This is the most common misunderstanding about Latvian payroll. On top of the gross salary, the employer pays its own share of social contributions at 23.59% (VID, verified 13 August 2026). That amount sits above gross pay; it is not taken out of it.
Employer contributions therefore never appear on the employee's payslip as a deduction and have no effect on the net figure. At a gross salary of EUR 1,750, employer contributions are EUR 412.83, the total labour cost to the employer is EUR 2,162.83, and the employee's net salary is still EUR 1,307.11.
For an employee at pension age the employer rate is 20.77% (VID, verified 13 August 2026).
The practical consequence: when 23.59% comes up in a salary discussion, it describes the employer's cost, not what reaches your account.
Calculation for an employee with no dependants, with the payroll tax book filed, not at pension age (rates: VID, verified 13 August 2026).
Gross salary: EUR 1,750.00.
Social contributions at 10.5%: −EUR 183.75.
Tax-free allowance, not subject to income tax: −EUR 550.00.
Amount subject to income tax: EUR 1,016.25.
Income tax at 25.5% of EUR 1,016.25: −EUR 259.14.
Net salary: EUR 1,307.11.
With one dependant, a further EUR 250 would come off the taxable amount and the net figure would be higher.
The payroll tax book. If it has not been filed with this employer, the EUR 550 monthly allowance is not applied and the net figure is lower (VID, verified 13 August 2026).
Dependants. Each dependant reduces the taxable amount by EUR 250 per month, and a pensioner has an allowance of EUR 1,000 per month (VID, verified 13 August 2026).
Pension age. The employee contribution rate is 9.25% rather than 10.5%, so the same gross salary produces a higher net figure.
Higher incomes. Monthly payroll always withholds 25.5%. Annual income above EUR 105,300 is taxed at 33%, settled in the annual declaration rather than in monthly payroll. A 3% solidarity surcharge applies above EUR 200,000 a year, and the annual social contribution ceiling is EUR 105,300 (VID, verified 13 August 2026).
The minimum monthly wage in Latvia in 2026 is EUR 780 before tax (VID, verified 13 August 2026).
This page computes figures from published rates and does not provide tax advice.
Gross salary is pay before tax — the figure written in the employment contract. In Latvia in 2026, employee social contributions of 10.5% and income tax of 25.5% are deducted from it (VID, verified 13 August 2026). Employer contributions are not part of gross.
Net salary is the amount the employee receives in their bank account after 10.5% social contributions and 25.5% income tax are withheld in Latvia in 2026 (VID, verified 13 August 2026). Gross EUR 1,750 a month with no dependants gives net EUR 1,307.11.
Subtract social contributions of 10.5% from gross, then take the EUR 550 tax-free allowance and EUR 250 per dependant off the remainder, and charge 25.5% income tax on what is left (VID, verified 13 August 2026). Gross EUR 1,750: 1,750 − 183.75 − 259.14 = EUR 1,307.11 net.
No. In Latvia in 2026, employer social contributions of 23.59% are paid on top of gross salary and never appear on the employee's payslip (VID, verified 13 August 2026). At gross EUR 1,750 they add EUR 412.83, and the net salary is still EUR 1,307.11.
The tax-free allowance in Latvia in 2026 is EUR 550 per month, the dependant allowance is EUR 250 per month, and the pensioner allowance is EUR 1,000 per month (VID, verified 13 August 2026). They apply only when the payroll tax book has been filed.
The minimum monthly wage in Latvia in 2026 is EUR 780 gross, that is before 10.5% social contributions and 25.5% income tax are withheld (VID, verified 13 August 2026). The net figure depends on the payroll tax book and the number of dependants.
In Latvia in 2026, monthly payroll always withholds 25.5%. The 33% rate applies to annual income above EUR 105,300 and is settled in the annual income declaration, never in monthly payroll (VID, verified 13 August 2026).