Lithuania Tax Calculator (2026)
Income tax rates and take-home pay for Lithuania
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Lithuania Income Tax Brackets (2025)
| Bracket | Income Range | Rate |
|---|---|---|
| Employment income up to EUR 126,532 | €0 - €126,532 | 20.0% |
| Employment income exceeding EUR 126,532 | €126,532+ | 32.0% |
Personal allowance: €8,200
Social security and health insurance contributions
| Bracket | Income Range | Rate |
|---|---|---|
| Up to EUR 126,532 | €0 - €126,532 | 19.5% |
| Above EUR 126,532 (health insurance only) | €126,532+ | 7.0% |
Key Facts
Tax Year
2025
Currency
EUR
Top Rate
32.0%
Brackets
2 brackets
Allowance
€8,200
Social Contributions
1 item
Assumptions
- · Representative resident employee model: single, no dependents, age 35, full-year employment.
- · Employment-related income is subject to 20% PIT up to EUR 126,532 and 32% above that threshold.
- · Employee social security contributions are 19.5% (including 6.98% health insurance) up to EUR 126,532, then 6.98% above.
- · Monthly tax-exempt allowance (TEA) is calculated based on employment income, with a maximum EUR 747/month when income ≤ EUR 1,038/month, then tapered.
- · TEA simplification: modeled as an annual allowance of approximately EUR 8,200 for representative mid-range salary; actual TEA depends on monthly income distribution.
- · Employer-side social contributions (1.45–2.71% for regular contracts, 0.16% Guarantee Fund, 0.16% Long-term Employment Fund) are excluded as they do not reduce employee take-home pay.
- · Optional second-tier pension contributions (3% + 1.5% state match) are excluded as voluntary.
- · No inheritance tax, gift tax, or luxury tax applied to employment income.
- · No subnational income tax in Lithuania.
Frequently asked questions
How much income tax do I pay as an employee in Lithuania?
Lithuania has a progressive income tax system with two brackets: 20% on employment income up to EUR 126,532 and 32% on income exceeding that threshold. You also receive a tax-exempt allowance (TEA) of approximately EUR 8,200 annually, which reduces your taxable income and lowers your overall tax burden.
What are social security contributions in Lithuania and how much do I pay?
As an employee, you pay 19.5% in social security and health insurance contributions on income up to EUR 126,532, then only 6.98% (health insurance) on income above that amount. These contributions are deducted from your gross salary but are not tax-deductible, so they reduce your take-home pay directly.
Do I pay regional or state income taxes in Lithuania?
No, Lithuania has no regional or subnational income taxes. The national income tax rates and social contributions apply uniformly across the entire country, making the tax system straightforward regardless of where you live or work within Lithuania.
What is the tax-exempt allowance (TEA) and how does it work?
The tax-exempt allowance is a monthly benefit that reduces your taxable income; the maximum is EUR 747 per month for lower earners, then gradually decreases as your income rises. For a representative mid-range salary, this averages to about EUR 8,200 annually, which directly lowers the amount of income subject to the 20% or 32% tax rates.
Are there any other taxes I should know about as an employee in Lithuania?
Lithuania has no inheritance tax, gift tax, or luxury tax on employment income, keeping the tax system relatively simple for employees. The main taxes affecting your take-home pay are the income tax and social security contributions mentioned above.
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