A payslip is a document that your employer is legally required to provide you with, no later than payday.
What does your payslip contain?
Your payslip must contain:
Gross pay
Fixed and non-fixed payments
Fixed and non-fixed deductions
The number of hours worked if you're paid hourly
Net pay
Note: With effect from April 2019, your payslip must include the number of hours worked if you're paid per hourly. For example:
You're only paid for the hours you work.
You're paid a salary but your overtime is paid in hours.
In addition to this, your payslip usually includes:
Your name and home address
Your tax code
Your National Insurance (NI) number
Your payroll number
The tax period your pay relates to
The pay period and the pay date your pay relates to
The payment method, i.e. BACS or cheque.
Your annual leave entitlement
Your year-to-date figures
Your employer's contributions
Who gets a payslip?
Not everyone is entitled to a payslip. The types of individuals who aren't entitled to a payslip are:
A contractor or self-employed person
A merchant seaman
A person in the police service
A person working in share fishing
Your PayFit payslip
Below is a PayFit payslip, with each of the sections explained. Click the image for a bigger version.
Payslip deductions
The type of deduction will depend on where it is shown on a payslip. For example:
Tax, NI and student loan show in the deductions section.
Salary sacrifice deductions, or deductions for absences are shown as a negative value in the payments section. These deductions impact the calculation of tax, national insurance and student loan.
Deductions that impact either your taxable or NI'able pay, show in the deductions section.
Keeping your payslip safe
It is important to keep your payslip safe for the following reasons:
Security - Your payslip contains a lot of personal information about your earnings and your identity. This means that keeping your payslip safe is critical to avoiding identity fraud.
Record keeping - Your tax and NI affairs are ultimately your responsibility and your payslips are great for helping with any queries that you may have with the HMRC or the DWP.
Proof of earnings - Your payslip may be requested for certain financial transactions such as tenancy or mortgage applications. They act as a true indicator of your gross and net earnings.
Glossary of Terms
Fixed deduction
A deduction that doesn't change month to month, such as a season ticket loan or contributions towards private medical insurance.
Gross pay
The total of your base salary plus any other payments such as bonuses, overtime or commission.
Net pay
The sum of your gross pay minus all deductions. This is the value you'll receive on payday.
Non-fixed deduction
A deduction that changes month to month such as tax, national insurance and student loan. These are all dependent on your earnings.
Pay method
How your employer makes payments to you. For example, faster payment or BACS.
Pay period
The period your pay relates to. E.g., 1-31 January.
Tax period
The tax period in which your pay relates to. For example, 6th of the month to the 5th of the following month. This is the period that HMRC use to assign your tax and national insurance records.