Gross Amounts

What is Gross Amounts?

The Gross amount is defined as the sum of all forms of earnings, such as wages, salaries, interest payments, profits, and rents, before any deductions or taxes are applied. It is the opposite of net amounts. Gross is, therefore, a term or adjective that is defined as “without deductions”. It is the total and the number of sales, salary, or profit before applying any deductions for expenses or taxes.

Gross pay, or gross payment, is the starting point for understanding finances. It's the total an employee earns before taxes and any other deductions are taken away. For example, if an employee earns an annual salary of $40,000, this equates to $40,000 in gross pay.

Conclusion

Processing an employee’s pay correctly can be challenging without the latest information and the right experts who continue to monitor ever-changing regulations. Therefore, when it comes to employees’ pay, it’s important to be well-versed on all forms of payroll terms and to explain how they work while having a full understanding of the rules around the deductions.

For additional information, see terms entitled Gross Wages, Gross Income, Gross vs. Net Income, Grossing-Up.