How much does it cost to hire an employee in North Macedonia? Compared with Western Europe, salaries are attractive, and the tax system is one of the simplest in the region. But to budget correctly, you need to understand the difference between gross and net salary, the 28% social contributions, the 10% flat income tax and common extras such as the holiday allowance. This guide breaks down the real cost of employing someone in North Macedonia in 2026.
- Average salary and minimum wage in North Macedonia
- How gross and net salary work
- Social contributions and income tax in 2026
- Worked example
- Other employment costs to budget for
- Frequently asked questions
Average salary and minimum wage
The national average gross salary used for 2026 contribution calculations is MKD 69,141 per month (about €1,120). Salaries in Skopje, and in sectors such as IT, finance and engineering, are typically well above this average. Experienced software developers often earn two to three times the national figure.
The national minimum net wage was raised to MKD 26,046 per month from 1 March 2026 (about €420), up from MKD 24,379.
Gross vs net salary: why it matters
In North Macedonia, almost all statutory payments are deducted from the employee’s gross salary. The employer pays them to the state on the employee’s behalf. Unlike in many EU countries, there is generally no large additional employer social security charge on top of gross pay. So your main payroll cost is the gross salary itself, but candidates often think in terms of net salary. Always agree on both figures in the offer.
Social contributions and income tax (2026)
| Contribution | Rate (of gross) |
|---|---|
| Pension and disability insurance | 18.8% |
| Health insurance | 7.5% |
| Unemployment insurance | 1.2% |
| Additional contribution (work injury / occupational disease) | 0.5% |
| Total social contributions | 28% |
- Contribution base: contributions are paid on a base of at least 50% of the national average gross salary and are capped at 16 times the average (MKD 1,106,256 per month in 2026).
- Personal income tax: a flat 10%, charged on gross salary minus social contributions and a monthly personal allowance of MKD 10,932.
Worked example: MKD 80,000 gross per month
| Item | Amount (MKD) |
|---|---|
| Gross salary | 80,000 |
| Social contributions (28%) | −22,400 |
| Taxable base (80,000 − 22,400 − 10,932) | 46,668 |
| Personal income tax (10%) | −4,667 |
| Net salary paid to employee | ≈ 52,933 |
In this example, the employer’s statutory payroll cost is the MKD 80,000 gross salary (about €1,300). The employee takes home around 66% of gross. To offer a specific net salary, work backwards. A net salary of MKD 60,000, for instance, requires a gross salary of roughly MKD 91,000.
Other employment costs to budget for
- Holiday allowance (regres): under collective agreements, employees typically receive an annual leave allowance, commonly around 40% of the average net salary.
- Meal and transport allowances: often provided under collective agreements or company policy. Within set limits they can be tax-advantaged.
- Paid annual leave: 20 to 26 working days per year, plus public holidays.
- Sick leave: the employer pays sick leave for the first 30 days, after which the Health Insurance Fund takes over.
- Overtime: paid with a premium on top of the regular hourly rate and limited in hours per week and year.
- Bonuses and 13th salary: not mandatory, but common in some companies and helpful for retention.
- Severance: when employment ends for business reasons, severance depends on years of service.
- Private health insurance, equipment and co-working space, which many international employers offer.
- Employer of Record or payroll service fees.
Why companies choose North Macedonia
A flat 10% income tax, a currency pegged to the euro, the same time zone as most of Central Europe and strong English skills make North Macedonia a cost-effective and predictable place to build a team. It’s especially popular for software development, engineering, finance and customer support.
Frequently asked questions
Q: Does the employer pay extra social security on top of gross salary?
A: Generally no. The 28% contributions are deducted from gross salary, but the employer is responsible for calculating and paying them together with the net salary.
Q: Is it cheaper to hire in North Macedonia than in Western Europe?
A: Usually yes. Gross salaries are lower, income tax is a flat 10% and there is no large extra employer social security charge, so total employment costs are often a fraction of those in Germany or the UK.
Q: Can I pay salaries in euros?
A: Salaries for local employees are paid in Macedonian denars (MKD). Through an EOR you can budget and be invoiced in euros or US dollars.
Q: Do I need a local company to hire in North Macedonia?
A: No. Read how to hire employees in North Macedonia without a company.
Get a free cost estimate
NNRoad can prepare a full gross-to-net and total cost breakdown for any role in North Macedonia before you make an offer. Learn more about our Employer of Record service in North Macedonia or email [email protected].
This article is for general information only and does not constitute legal or tax advice. Figures are current as of 2026 and may change; euro amounts are approximate.