Employer payroll taxes — also called employer on-costs — are the social contributions a company pays on top of an employee’s gross salary: pension, health, unemployment, and other funds. Across our country guides they typically run from about 2% to 40% of gross pay, set by each country’s law.
Last updated July 18, 2026. Jump to: How on-costs work · The country table · In real money · Why rates mislead · Highest and lowest · FAQ
What are employer payroll taxes?
Employer payroll taxes are the mandatory contributions an employer pays for each employee. They are separate from the tax withheld from the worker’s pay. They sit on top of the gross salary, so they raise the true cost of a hire above the headline wage.
Most countries group these on-costs into a few core categories:
- Pension or retirement — the largest cost in most countries.
- Health or social insurance — funds public healthcare and sickness cover.
- Unemployment — pays into a national jobless fund.
- Other statutory funds — accident insurance, training levies, family or housing funds, and wage-guarantee schemes.
A worker paid the same gross salary can cost very different amounts to employ, depending on where they live. That is why a real budget starts with the country, not the wage. Our employment cost calculator adds these on-costs to a gross salary for a single all-in figure.
The rates below are the employer share only. Each country also withholds income tax and an employee social-security share from the worker’s pay — those are not an employer cost and are not counted here.
Employer payroll taxes by country
The table lists the headline employer contribution for 32 countries, drawn from our country guides and checked July 2026. Each country name links its full guide, where the exact bands, caps, and components are set out. Where a rate is capped or varies, the range is shown as our guides state it — not flattened to one number.
| Country | Total employer contribution | Main components |
|---|---|---|
| Argentina | 23%–27% | Pension (SIPA) 10.77%, health 6%, labour-risk insurance ~2%–5% |
| Australia | 14.24%–19.35% | Superannuation 12%, state payroll tax 0%–6.85% |
| Austria | 21%–23% | Pension 12.55%, unemployment 2.95%, health 3.78% |
| Belgium | ~27%–30%+ | Social security (ONSS) ~25%, sectoral funds, holiday pay |
| Brazil | 29%–33.5% | Social insurance (INSS) 8.5%–12.5%, FGTS 8%, accident (SAT) 1%–3% |
| Bulgaria | 18.92%–19.62% | Social insurance incl. pension, health 4.8% |
| Canada | 7.9%–8.5% | Pension plan (CPP) 5.45%–5.9%, employment insurance 1.6%–2.2% |
| Chile | 5.18%–9.18% | Unemployment 2.4%–3%, social security 2.71%, illness insurance up to 3.4% |
| Colombia | 25%–36.5% | Pension (AFP) 12%, health (EPS) 8.5%, welfare (ICBF) 3% |
| Croatia | 16.5% | Social security contributions 16.5% |
| Egypt | 18.75% | Social security contributions 18.75% |
| Estonia | 33.8% | Pension 20%, health 13%, unemployment 0.8% |
| Finland | 27.69%–29.39% | Pension (TyEL) ~25.12%, unemployment 0.5%–2.05%, health 1.16% |
| France | 28.4%–60.5% | Social security 26.5%–33.7%, accident insurance 1.9%–2.2%, transport tax |
| Germany | ~19.3% | Pension 9.3%, health 7.3%+, care 1.53%, unemployment 1.2% |
| Greece | 22%–23% | Pension 13.33%, health 4.3%, supplementary 3.25% |
| Hungary | 13% | Social contribution tax 13% |
| India | ~15%–25% | Provident fund (EPF) 12%, state insurance (ESI) 3.25%, gratuity accrual |
| Indonesia | ~10%–12% | Healthcare (BPJS) 4%, old-age (JHT) 3.7%, pension (JPN) 2% |
| Italy | 28%–33% | Social security (INPS) 28%–33% |
| Mexico | 39.69%–46.72% | Social security (IMSS) 26.54%–33.58%, retirement (SAR) 5.15%, housing (INFONAVIT) 5% |
| Morocco | ~16.6% | Social security (CNSS) 10.89%, health (AMO) 4.11%, training 1.6% |
| New Zealand | 3%+ | KiwiSaver 3%, accident levy (ACC) ~0.72%–1% |
| Norway | 16.1%–39.2% | Social security 14.1%, supplementary pension 2%–25.1% |
| Poland | 19.5%–28.5% | Social security (ZUS) 19.48%–22.14%, capital plan (PPK) 1.5% |
| Portugal | 26.5% | Social insurance 23.75%, labour accident 1.75%, wage-guarantee fund 1% |
| Romania | 2.5% | Work-insurance contribution 2.25% |
| Serbia | 15.15% | Pension and disability 10%, health 5.15% |
| Singapore | 7.75%–17.25% | Provident fund (CPF) 7.5%–17%, skills levy (SDF) 0.25% |
| Spain | ~32.5% | Common contingencies 23.6%, unemployment 5.5%–6.7%, training 0.6% |
| Sweden | 31.42% | Pension, health, parental and labour-market fees, combined 31.42% |
| Turkey | 23.75% | Old-age and death 12%, health 7.5%, unemployment 2% |
Source: our country guides, checked July 2026. For the full withholding tables, caps, and employee-side rates, open a country’s employment guide.
What the rates mean in real money
The percentages turn into large gaps once you apply them to a salary. Take an illustrative hire on 60,000 gross per year, using the headline employer rates above:
| Country | Headline rate | Illustrative employer on-costs | Total cost |
|---|---|---|---|
| Romania | 2.5% | ~1,500 | ~61,500 |
| Canada | 7.9%–8.5% | ~4,740–5,100 | ~64,740–65,100 |
| Germany | ~19.3% | ~11,580 | ~71,580 |
| Spain | ~32.5% | ~19,500 | ~79,500 |
| Mexico | 39.69%–46.72% | ~23,814–28,032 | ~83,814–88,032 |
Same salary, but the total cost to employ swings by more than 26,000 between Romania and Mexico. These figures are illustrative — they apply the headline rate flat and ignore caps, so a real quote can be lower. That is exactly why the next section matters.
Why the headline rate alone can mislead
A single percentage is a useful anchor, but it rarely equals the real cost. Three things move the true number:
- Caps and floors. Many countries stop charging a contribution above a salary ceiling. A high headline rate can apply to only part of the pay, so the effective rate falls as the salary rises.
- The base. Some rates apply to gross salary; others apply to a different base, or to basic pay only, not total pay. India’s provident fund, for example, is calculated on basic pay plus allowances, not the full package.
- Regional and sector variation. Rates can shift by state, province, or industry. Australia adds a state payroll tax; France adds a transport levy in some areas; accident-insurance rates depend on the work’s risk level.
There are also one-off and annual costs that no single rate captures — things like the 13th-month salary in parts of Latin America and Europe, or end-of-service accruals. For a real all-in figure, run the numbers in our cost calculator, then read the country guide for the detail. Our guide to employer of record cost breaks down how these statutory costs sit alongside a provider fee.
Highest and lowest employer taxes
The higher bands
The heaviest employer on-costs in our corpus sit in continental Europe and parts of Latin America. France tops the list, with a headline range up to 60.5% once every levy applies. Mexico runs 39.69%–46.72%, Estonia is a flat 33.8%, Spain is about 32.5%, and Sweden is 31.42%. Colombia reaches 36.5% at the top of its range.
The lower bands
At the other end, employer on-costs are light where more of the social burden falls on the employee or on income tax. Romania is about 2.5%, New Zealand starts near 3%, Chile runs 5.18%–9.18%, and Canada and Singapore both sit under 9% at the low end. A low employer rate does not always mean a cheap hire — the employee-side deductions may be higher instead.
A low headline rate is not the whole story. What matters for your budget is the all-in cost of the specific salary in the specific country — caps, bases, and extra funds included. That is what the cost calculator computes.
Frequently asked questions
What are employer payroll taxes?
Employer payroll taxes are the mandatory social contributions a company pays for each employee, on top of the gross salary. They typically fund pension, health, unemployment, and other statutory schemes. They are separate from the income tax and employee social-security share withheld from the worker’s own pay, and they raise the real cost of a hire above the headline wage.
How much do employers pay on top of salary?
It depends entirely on the country. Across our country guides, employer on-costs run from about 2% of gross pay in the lightest countries to around 40% or more in the heaviest, checked July 2026. Romania sits near 2.5%, while Mexico and France reach the high 30s and above once every levy applies.
Which country has the highest employer payroll taxes?
Among the countries in our table, France has the highest headline employer contribution, with a range reaching up to 60.5% once all levies apply. Mexico (39.69%–46.72%) and Colombia (up to 36.5%) are the next highest. These are headline ranges; the effective rate can be lower because some contributions stop above a salary cap.
Which country has the lowest employer payroll taxes?
In our table, Romania has one of the lowest employer contributions at about 2.5%, followed by New Zealand at around 3%. Canada, Chile, and Singapore all sit under 9% at the low end of their ranges. A low employer rate often means more of the social cost falls on the employee instead, so it does not always make the hire cheaper.
Are employer payroll taxes the same as tax withholding?
No. Withholding is money taken out of the employee’s own pay — income tax and their share of social security — which the employer collects and sends to the authorities. Employer payroll taxes are an extra cost the employer pays on top of the salary. Withholding reduces what the worker takes home; employer taxes raise what the company spends.
Do contractors trigger employer payroll taxes?
Genuine independent contractors invoice you and handle their own taxes, so you pay no employer contributions on them. But if a contractor is treated like an employee, an audit can reclassify them and demand back-dated employer taxes and penalties. Our guide to contractor management explains how to keep the relationship compliant.
How do I estimate the full cost of a hire abroad?
Start with the gross salary, then add the country’s employer on-costs plus any 13th-month pay or statutory accruals. Our employment cost calculator does this for you and returns a single all-in figure, and each country guide shows the exact bands and caps behind it.
What happens to employer payroll taxes with an employer of record?
An employer of record becomes the legal employer, so it registers, calculates, and remits all statutory employer contributions in that country on your behalf. The costs still apply — local law sets them — but the EOR handles the filing and compliance. Our guide to what an employer of record is explains the model.
Hire anywhere, with the on-costs handled
Remote& brings contractors, EOR, and contractor of record onto one platform — statutory employer taxes registered, calculated, and remitted in each country for you. See how it works, or book a walkthrough.