Payroll
/
Lithuania
Global coverage
Available in +150 countries
Employer costs, taxes, minimum wage and leave rules for hiring here, plus the faster route: hire a contractor with Ontop, no local entity needed.
2026
Currency
EUR € (Euro)
Employer contributions
~1.77% employer social insurance (guarantee fund + accident)
Minimum wage
€1,038 EUR (2026)
Payment frequency
Monthly
Calendar year (Jan 1 - Dec 31)
Capital
Vilnius
Timezone
EET (GMT+2)
Employee or contractor
If the work is project-based or you need to move fast, a contractor gets you the same talent with a fraction of the paperwork.
Employee
~€2,544 EUR total
/month
For a gross salary of
€2,500 EUR gross/month
Setup
Local entity or employer of record, plus tax and social security registration
Employer contributions
~1.77% employer social insurance (guarantee fund + accident)
Mandatory extras
Annual Bonus
Monthly admin
Monthly payroll / SoDra by 15th / VMI GPM withholding / annual May filing
Contractor with Ontop
No local entity
$49
/contractor/month
The agreed rate, plus Ontop from $49 per contractor per month.
Sign a contract, yours or an Ontop template. No local registration on your side.
No employer contributions: the contractor handles their own taxes and social security.
One payment per invoice, in one payroll run.
Paid into their Ontop Global Account in USD.
See the full side-by-side comparison
+
A contractor's rate usually covers their own taxes, so compare total cost, not just gross pay. Run your numbers in the contractor vs employee calculator.
Hiring here: the full breakdown
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Payroll guide
Employer costs come on top of gross pay. Use these figures to budget a hire and to compare it with a contractor rate.
Total monthly cost
~€2,544 EUR total
Example gross salary
€2,500 EUR gross/month
~€1,712 EUR net
Net pay to the employee
Tax and employee contributions
Withheld from gross pay
~€44 EUR employer SS
Employer contributions on that salary
Employer contributions
~1.77% employer social insurance (guarantee fund + accident)
Employee contributions
~19.5% employee SS + 15-20% income tax
Total cost above gross
~1.77% above gross (social tax mainly on employee)
Figures are estimates for planning. Rates change with each budget and can vary by sector, so confirm them before you make an offer.
What people earn here, from the legal floor to the main cities, plus the extra pay most employers budget for.
National average
~€2,000 EUR
Per month
Vilnius
€2,200 - €3,800 EUR
~25%
Kaunas
€1,700 - €2,800 EUR
~8%
Monthly gross. National average salary per year:
~€24,000 EUR
Minimum wage
€1,038 EUR (2026)
Paid:
Monthly
Extra pay
Annual Bonus
Discretionary
December
Collective agreements can set sector minimums above the national one. Check whether one applies to the role before you set the salary. Next step: estimate the full cost of an employee.
Who collects what, how often, and what happens when a payment is late.
Income tax brackets
20% up to €101,094 / 32% above (2026)
Tax year:
Calendar year (Jan 1 - Dec 31)
Filing calendar
Monthly by 15th
Social security payments
May 1 (annual GPM311/312)
Income tax
End of January
Employee tax certificate
Pažyma apie gautas pajamas
May 1
Annual return
GPM311/312 annual
Late payment penalties
Late SoDra: 0.03%/day; late GPM: 0.03%/day
Who collects what
VMI
Income tax (GPM)
SoDra
Social insurance and pension
VDI (State Labour Inspectorate)
Labor law enforcement
The time off and paid leave every employee is entitled to by law. Budget for it when you compare an employee with a contractor.
Annual leave
Kasmetinės atostogos
20 working days
Public holidays
14 public holidays
Sick leave
Nedarbingumas
4/5 working days employer; SoDra from day 4
Maternity leave
18 weeks
77.58% SoDra (capped)
The contracts you can use, and what ending an employment relationship costs.
Permanent
Neterminuota darbo sutartis
Fixed term
Terminuota darbo sutartis
Independent contractor
Individuali veikla / Paslaugų sutartis
Collective agreements
Kolektyvinė sutartis
Ending employment
Išeitinė išmoka
How it is calculated
1-6 months based on seniority
Calling someone a contractor does not make them one. If the role works like employment in practice, local authorities can reclassify it, with back contributions and penalties.
The errors that most often trigger back payments and penalties here, and what to do instead.
Incorrect Employer vs Employee SS Split
Risk Level: HIGH
Lithuania shifted most social contributions to employees in 2019, but the employer still pays small amounts (guarantee fund, accident insurance). Many international employers apply incorrect rates or expect higher employer contributions similar to neighboring countries. Underpaying employer portions triggers VDI fines.
Remote Work Fixed Deduction Misuse
Risk Level: MEDIUM
Lithuania allows a 30% fixed deduction for remote work expenses. Over-applying this deduction to workers not genuinely working remotely, or applying it beyond the statutory cap, triggers VMI audits.
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Next topicOntop is the Global Workforce Engine for contractor teams: contracts, compliance documents and payments in 150+ countries.
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$49
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FAQ
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Ontop works with contractors, not employees. As Contractor of Record, Ontop handles contracts, compliance documents and payments for contractors in 150+ countries. To employ someone, you need a local entity or an employer of record. Ontop doesn't act as your employer of record.
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Employers pay contributions on top of gross salary. The cost table on this page shows the rates that apply here and a worked monthly example. A contractor with Ontop costs the agreed rate plus Ontop from $49 per contractor per month.
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Many countries require an extra month or an annual bonus for employees. The salaries section on this page shows the one that applies here and when it is usually paid. Contractors are paid what you agree in the contract.
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Employers withhold income tax and the employee's social security share every pay run, then pay them to the local authorities. The taxes section on this page lists the brackets, rates and filing deadlines that apply here.
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Yes. The contractor vs employee calculator compares the full cost of an employee, employer contributions included, with a contractor rate plus Ontop's monthly fee.
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When the work is project-based, you need to start fast or you don't have a local entity. If the person will work fixed hours, under your direction and only for you, local law may treat them as an employee, so hire them as one.
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Misclassifying employees as contractors, missing tax and social security deadlines, and ignoring collective agreements that set higher wage floors. The mistakes section on this page covers the ones that come up most often here.
Compare employer costs, taxes and contractor rules in nearby countries:
Ready to hire? See Ontop pricing or learn how to build a global team without an employer of record.
Ready to hire? See Ontop pricing or learn how to build a global team without an employer of record.