Introduction: Why Understanding Your Net Salary in Albania Matters
A Complete Breakdown for Employees, Employers, and Freelancers
Whether you’re an expat working in Tirana, a freelancer operating remotely from Shkodra, or a local employee navigating job offers, understanding how salaries are taxed in Albania in 2025 is critical.
This guide covers:
- Gross vs. Net salary
- Income tax brackets
- Social security & health contributions
- Employer vs. employee obligations
- Example salary calculations
- Tools and resources
Let’s break it down.
1. Gross Salary vs. Net Salary in Albania
Your gross salary is what’s agreed upon in your contract. Your net salary (or “take-home pay”) is what lands in your bank account after income tax and contributions are deducted.
2. Personal Income Tax (PIT) in Albania – 2025 Rates
Albania applies progressive taxation to personal income.
2025 Income Tax Brackets
| Monthly Gross Salary (ALL) | Annual Gross Salary (ALL) | Tax Rate |
| Up to 40,000 | Up to 480,000 | 0% |
| 40,001 – 200,000 | 480,001 – 2,400,000 | 13% |
| Over 200,000 | Over 2,400,000 | 23% (applies only to the amount above 200,000) |
Note: These rates are for employment income. Freelancers and businesses follow different rules.
3. Social Security & Health Contributions (2025)
Albanian law requires both employers and employees to contribute.
Employee Contributions
| Type | Rate (%) |
| Social Security | 9.5% |
| Health Insurance | 1.7% |
| Total | 11.2% |
Employer Contributions
| Type | Rate (%) |
| Social Security | 15% |
| Health Insurance | 1.7% |
| Total | 16.7% |
4. Step-by-Step Salary Calculator: Example (2025)
Let’s assume your monthly gross salary is 120,000 ALL.
Step 1: Calculate Social & Health Contributions (Employee)
- 9.5% Social Security: 120,000 × 9.5% = 11,400 ALL
- 1.7% Health Insurance: 120,000 × 1.7% = 2,040 ALL
- Total Contributions: 13,440 ALL
Step 2: Determine Taxable Income
Taxable Income = Gross Salary – Social & Health = 120,000 – 13,440 = 106,560 ALL
Step 3: Apply PIT (13%)
Since 106,560 ALL falls in the 13% tax slab (above 40,000), the first 40,000 is tax-free, and the rest (66,560) is taxed at 13%.
- Tax = 66,560 × 13% = 8,652.80 ALL
Step 4: Calculate Net Salary
Net Salary = Gross – Contributions – Tax
= 120,000 – 13,440 – 8,652.80 = 97,907.20 ALL
Take-Home Pay: ~97,907 ALL/month
5. Freelancer & Contractor Taxation in Albania (2025)
If you are registered as a freelancer or self-employed, different tax rates apply:
| Type | Rate |
| Income Tax | Flat 15% |
| Social & Health Combined | 23% |
Example:
If you earn 150,000 ALL/month:
- Social & Health (23%) = 34,500 ALL
- Taxable Income = 115,500 ALL
- PIT (15%) = 17,325 ALL
- Net = 98,175 ALL
You’re also responsible for your own tax filings.
6. Employer Cost of Hiring in Albania
Employers contribute 16.7% on top of your gross salary.
For a 120,000 ALL salary:
- Employer pays: 120,000 × 16.7% = 20,040 ALL
- Total employer cost: 140,040 ALL/month
7. Minimum & Average Salary in Albania (2025)
| Indicator | Amount (2025) |
| Minimum Wage | ~40,000 ALL |
| Avg. Gross Salary | ~75,000 – 85,000 ALL |
| Avg. Net Salary | ~65,000 – 72,000 ALL |
8. Tax Deductions & Allowances (2025)
Employees may claim deductions for:
- Dependents (children)
- Disability
- Voluntary pension schemes
These may reduce your taxable income. However, they must be claimed via annual tax declaration.
9. Income Tax Filing in Albania
- Employees: Usually deducted by the employer (no filing required unless you have multiple incomes).
- Freelancers/Businesses: Must file online via e-filing portal.
Deadline: March 31, 2026 (for income earned in 2025)
10. Tools & Salary Calculators (2025)
| Tool | Link |
| Official Salary Calculator (2025) | https://financa.gov.al |
| Tax Office Albania | https://tatime.gov.al |
| Freelance Tax Portal | https://e-albania.al |
Conclusion
Navigating salary and taxes in Albania doesn’t need to be overwhelming. Whether you’re negotiating a new role, hiring a team, or freelancing across borders, understanding how gross salary converts to real net income helps you make informed decisions.
Use the example above or one of the tools listed to estimate your true monthly earnings.
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