🧮 Effective Tax Rate Calculator
Your effective tax rate is the percentage of your total income you actually pay in tax — quite different from your marginal rate, which only applies to your last euro earned. Enter your gross income and the tax you actually paid, and see at a glance how heavy your real tax burden is.
Formula
Effective rate = (tax paid ÷ gross income) × 100
This is a simple ratio: your total tax amount divided by your total income, multiplied by 100 for a percentage. Because a progressive system only taxes the portion above a threshold at a higher rate, your effective rate is almost always lower than your top (marginal) bracket. The bigger the gap between effective and marginal rate, the more of your income falls into lower brackets.
Steps
- 1Enter your gross income — your total income before tax.
- 2Enter the tax you actually paid, for example from your assessment or payslip.
- 3Read off your effective rate and net income, and compare it with your marginal rate.
Effective rate at different incomes
| Gross income | Tax paid | Effective rate |
|---|---|---|
| € 25,000 | € 3,750 | 15% |
| € 40,000 | € 7,600 | 19% |
| € 60,000 | € 15,000 | 25% |
| € 90,000 | € 27,900 | 31% |
| € 150,000 | € 54,000 | 36% |
Illustrative examples; your own effective rate depends on your own deductions and the brackets that apply to you.
commonMistakes
- Confusing the effective rate with the marginal (top bracket) rate, which is usually higher.
- Counting only wage tax and overlooking other levies, such as contributions.
- Treating net income as "what's left to save", without accounting for fixed expenses.
useCases
- Comparing your actual tax burden across different years or situations.
- Checking whether your tax assessment makes sense against your expected rate.
- Running through different scenarios, such as a pay rise or extra freelance income.