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Your payslip explained

Your payslip explained

Category: Money

Updated: 13/02/2017
First Published: 13/02/2017

Every employee has the right to know how much they will be paid and how often. If you are employed and get paid, you should get a payslip every week, fortnight or month, depending on how your employer pays your wages or salary.

Payslips can get quite complicated, so check out the moneyfacts.co.uk basic guide to understanding this important document.

For more information on your payslip, check out the official gov.uk website Payslips: Your rights.

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Your Payslip Explained...


If you are employed you should get a payslip either every week, fortnight or month depending on how your employer pays you. Payslips can get quite complicated, so check out our basic infographic to understanding your payslip.

Employee No. Employee Name Process Date National Insurance Number
3 Mr. Malvin Hunt 28/10/2016 SP739355C

Payments Units Rate Amount Deductions Amount
Salary 1.00 2916.66 2916.66 PAYE Tax
National Insurance
425.80
272.28

This period Year to Date
Total Gross Pay
Gross for Tax
Earnings for NI

Payment Period
2916.66
2916.66
2913.00

Monthly
Total Gross Pay TD
Gross for Tax TD
Tax Paid TD
Earnings for NI TD
National Insurance TD
20416.62
20416.62
2980.80
20391.00
1905.96

Company Name...
Tax Code 944L Payment Method: BACS Tax Period 7 Net Pay 2218.58

Employee Number & Name
This is the internal identification number your employer gives you.

National Insurance (NI)
Your National Insurance entitles you to certain state benefits including a state pension. Your NI will be deducted directly from your wages by your HR department.

Salary
This is the amount you have earned before any deductions have been made. Your employer may break this down into components if you have done overtime or received a bonus/ commission.

PAYE Tax
Income tax will be deducted straight from your wages by your employer. How much you pay depends on your Personal Allowance and the amount you earn.

Pension Contribution
You probably participate in an occupational pension scheme particularly now auto enrolment has been implemented. If you do participate your tax-free deductions will be shown in the 'Deductions' column.

Other Deductions
If you are repaying a Student Loan it will be deducted from your wages. There can also be other deductions such as charity donations or Christmas savings club, for instance.

This Period
This Period shows you the total pay, tax and National Insurance you have paid in the last week or month, depending on when you last received a payslip.

Year to Date
Year to Date shows you the total amount of Pay, Tax and National Insurance you have paid in the current tax year to date.

Tax Code
Your Tax Code is very important as it tells your employer how much tax to deduct from your pay. If your tax Code is wrong you could be paying too little or too much tax. Visit the HMRC website for more information on tax Codes.

Tax Period
The Tax Period relates to when this payslip is issued in the tax year (6th April to the following 5th April). E.g. 7 would indicate the seventh month into the tax year.

Net Pay
This is the sum of money you will actually be paid after all deductions have been made. Payment methods vary i.e. cash or cheque but they are usually made by BACS transfer.


National Minimum wage
The current National Minimum Wage as of 01/10/2016 is as follows:

Age 25 and over
Age 21-24 inclusive
Aged 18 to 20 inclusive
Aged under 18 (but above compulsory school leaving age)
Apprentices aged under 19



£7.20
£6.95
£5.55
£4.00
£3.40

Disclaimer: This information is intended solely to provide guidance and is not financial advice. Moneyfacts will not be liable for any loss arising from your use or reliance on this information. If you are in any doubt, Moneyfacts recommends you obtain independent financial advice.

 
 
 

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