Terminology guide

Europe Calculator Glossary

Simple explanations of key terms used in salary, tax, rent, VAT, budget and cost-of-living calculators. Each term links to related calculators and tools.

All terms

20 terms defined

Gross Salary

Your salary before taxes and deductions are removed.

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Net Salary

Your salary after all taxes and deductions are removed — the amount you actually receive.

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Income Tax

A tax paid on earned income, deducted from your salary or paid on profit.

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Social Security

Compulsory contributions paid by employees and employers to fund public welfare programmes.

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Pension Contribution

Money set aside from your salary into a pension fund for retirement.

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Health Insurance Contribution

A deduction from salary that funds health or medical cover.

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Employer Contribution

Extra costs paid by an employer on top of gross salary — not deducted from your pay.

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VAT

Value Added Tax — a consumption tax added to goods and services.

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Net from Gross

Converting a gross salary figure to the estimated take-home net amount.

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Rent-to-Income Ratio

The percentage of monthly income spent on rent.

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Emergency Fund

Savings set aside to cover essential costs during unexpected events.

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Savings Runway

How many months your savings would last if income stopped.

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Debt-to-Income Ratio

The percentage of monthly income used to pay debts.

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Mortgage Affordability

How much mortgage you can safely repay based on income and existing debts.

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Utility Bills

Monthly costs for electricity, heating, water, internet and related home services.

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Move-in Cost

Total upfront cost when moving into a new rental apartment.

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Security Deposit

Money paid to a landlord at move-in, refundable if the property is left in good condition.

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Monthly Budget

A plan showing income, all monthly expenses and money left.

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Savings Rate

The percentage of income that goes into savings each month.

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Cost of Living

The total monthly amount needed to maintain a given lifestyle in a location.

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