Throughout ChurchSalary, compensation is presented using a consistent set of terms. Understanding what each term means—and how they relate to one another—will help you accurately enter Employee Profile information, interpret reports, and compare compensation across churches. The sections below explain each term used throughout the platform.
Annual Salary (or Total Salary)
The total amount a church pays a salaried staff member in a year before taxes.
For pastors who receive a housing allowance, Annual Salary is divided into two components:
Base Salary – The portion of salary paid directly to the pastor before taxes.
Housing Allowance – The amount designated for eligible housing expenses. For pastors living in a church-provided parsonage, this also includes the fair rental value of the parsonage.
Base Salary
The portion of a pastor's annual salary that is not designated as a housing allowance and is paid before taxes.
Housing Allowance
The annual amount designated for eligible housing expenses before taxes.
This may include:
Housing allowance for pastors who own or rent a home
Fair rental value for pastors receiving a parsonage benefit
Total Benefits
The total annual amount the church pays toward an employee's benefits.
Examples may include:
Health insurance
Retirement contributions
Life insurance
Disability insurance
Other employer-paid benefits
Note: Total Benefits only includes the employer's cost. Employee-paid premiums, copays, or other out-of-pocket expenses are not included.
Total Compensation
The total annual cost to the church for employing a staff member. Total Compensation = Annual Salary + Total Benefits
This includes:
Annual (Total) Salary
Total Benefits
💡 Good to know: These compensation terms and calculations are built directly into the Employee Profile form, making it easy to enter compensation information consistently and accurately.
Annual or Total Salary
Most non-ministerial employees get paid an annual salary. Because there is nothing to add up or “total,” most people talk about their pay by saying, “My annual salary is $70,000 a year.”
We often talk about the total salary of ministers because their annual salary is subcategorized into housing allowance and base salary. Adding both subcategories together gives you a “total.”
We use annual salary and total salary interchangeably because, ultimately, they are answering the same question—What does an employee get paid in a year before taxes?
Housing Allowance
Ordained ministers who receive a housing allowance can either receive a:
Cash Housing Allowance,
Parsonage Benefit, or
Both.
Cash housing allowance applies if the church sets aside a portion of the pastor’s total salary as a housing allowance. For example, the church pays the pastors $70,000 a year, but $35,000 of that total is set aside to pay for eligible housing expenses.
Parsonage benefit applies to less than 5% of pastors who live in a parsonage owned by the church. The IRS treats the fair rental value of the parsonage as a financial benefit and that value is counted towards the pastor’s total salary, but the church doesn’t give the pastor cash.
“Both” applies to pastors who live in a parsonage and get a cash allowance from the church to cover bills or housing-related expenses (e.g., yard work).
Base Salary
When a minister receives a housing allowance of some kind, the non-housing portion of their total salary is categorized as “base salary.” This portion of their total salary is subject to income tax.
These subcategories of total salary are evaluated individually in the Localized Salary Recommendation section as averages. But everywhere else, salary reflects the “total” or simply the “annual salary” of similar employees at similar churches.
Total Benefits
This figure reflects the total cost to the church of providing benefits for an employee.
Good to know 💡: At the moment, total benefits is only visible for Pro and Pro+ members in the Market Survey Match app.
Total Compensation
Total compensation is calculated by adding together total salary and total benefits. When ChurchSalary talks about “total compensation” this is what we have in mind.
We intentionally do not use the term “total comp” or “total compensation” to refer to the sum of base salary and housing allowance. This is a common point of confusion across other websites. So be careful and pay attention to definitions.