Payroll Definition

Every company that employs employees or workers must provide them with payroll by law. This is a document in text form, with information on the accounting period and the composition of the remuneration.

It also contains information on the nature and amount of allowances, allowances, other allowances, deductions, advances, or advance payments. By law, the remuneration, statutory deductions (social security contributions and taxes), and the payment amount must be calculated and reported.

Accordingly, payroll or a remuneration certificate must contain the following information:

  1. Employer’s name and address
  2. Name, address, and date of birth of the employee
  3. Insurance number of the employee
  4. Date of commencement of employment and termination of employment, date of the end of employment
  5. settlement period and the tax and social security days included therein
  6. Tax brackets, as well as child allowances, characteristics of the tax deduction, tax allowances, tax credits, and the tax identification number
  7. Where appropriate, whether it is an employment relationship in the sliding zone or an increase in employment.
  8. Name and amount of all remuneration and deductions, except contributions and employer subsidies for voluntary and private health insurance
  9. Balance of remuneration and deductions as taxable wages, as gross social security income and as total gross remuneration
  10. Statutory deductions from taxable wages and gross social security contributions

Payroll in practice

One-time paid work allowance, mini-job, part-time, full-time. The payroll must have the same information for all of them by law. In practice, there are many ways to create a payroll.

Many companies also give the payroll out of the house and have it prepared by the tax advisor. But you can also create payroll with the right template in Open Office or Excel.

Papershift shows you an example of what the presentation of a pay statement might look like:

Ongoing earnings (e.g. salary, hourly wage or monthly wage)
+ Monetary benefits in kind/benefits
+ Occupational retirement provision
= Total gross

– Occupational retirement provision
= Social security gross

– Tax allowances
– Occupational retirement provision
= Tax gross

– Payroll tax
– Solidarity surcharge
– Health insurance employee share
– Pension insurance Employee share
– Unemployment insurance Employee share
– Care insurance Employee share
– Contribution supplement for long-term care insurance
= Net earnings

– Non-cash remuneration
– VwL from the employee
– personal deductions such as attachment
+ Social security and tax-free expenses
= Withdrawal or transfer amount