Income vs Compensation
Summary
Income and compensation are related but distinct concepts. Income refers to what individuals receive, while compensation refers to the total value provided by an employer.
Main explanation
What is income
- received by the individual
- may be taxed
- measured periodically
What is compensation
- salary or wages
- employer contributions
- benefits in kind
- total employment cost
Key differences
- Perspective individual vs employer
- Scope narrow vs broad
- Tax treatment varies
Use in analysis
- income = take‑home resources
- compensation = labour cost
Differences across countries
- income classification
- compensation structure
- benefit treatment
What this page does not cover
- tax rules
- benefit valuation
- country‑specific systems
- planning strategies
- negotiation advice
References