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Rental and cell phone contracts are affected not only by inflation here but also by social security contributions. They currently make up around 18 percent of your salary but are capped. The maximum contribution for social insurance is presently 6,060 euros per month. In the coming year, this amount will rise by 6.3 percent to EUR 6,450 due to indexation, resulting in an annualized amount of EUR 90,300 instead of EUR 84,840. This affects not only the social security contributions but also the marginal earnings and additional earnings limits.
Despite the abolition of cold progression—the annual adjustment of tax brackets—higher earners could be in for a nasty surprise. The percentage increase in the maximum contribution limit for social insurance could cause their net earnings to fall, especially for salaries above €6,300 gross—if they do not receive a salary increase. Due to the higher social security contributions, this could lead to them having less in their wallets in 2025 than this year.
In addition to social security contributions, the marginal earnings threshold will also increase. This will be raised from 518.44 euros to 551.10 euros per month. This means that people who remain below this limit will earn slightly more in the future without paying social insurance contributions.
- source: oe24.at/picture: Image by Nattanan Kanchanaprat from Pixabay
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