Taxes are compulsory for the benefit of physical and legal entities that are levied by the state to support public expenditure. Each state has its tax system within which taxes constitute one of the most important ways of collecting government revenue. Income tax is one of the most important tax form in the modern tax system. It is of great importance to physical entities as it affects their final income. Income tax is a typical form of direct tax levied directly on the taxpayer's income. It is also a form of progressive tax, which is shown progressively in tax rates, thereby achieving the fairness of the tax system. Although income tax is taxed on a number of income types, the emphasis shall be placed on the taxation of income from employment present in the life od each individual in the employment relationship. That is why income from employment is the most common and most generous source of income. Receipts considered as income from employment are primarily wages and pensions. In the tax system of the Republic of Croatia, the employer is the one paying for its employees the gross amount of the salary in which the costs of compulsory social security contributions, taxes and surtax are covered. For this reason, the gross salary is always higher than the amount of net wages that the employee actually has at his disposal. It is therefore important to know how to calculate and establish the monthly salary of employees as well as individual items relevant to the identification of the same. This thesis clarifies the essential elements necessary for the accounting of the wage in the Republic of Croatia. The income tax analysis has also been carried out on income from employment in the Federal Republic of Germany with all the key components required to calculate the salary. This country has been chosen because it is a member of the European Union and belongs to the developed Member States. The ultimate aim of the thesis is to compare the method of accounting for wages and to determine the similarities and differences in income tax from employment in selected countries.