A payslip refers to a note that is given to a worker when they have been paid by their employees. On this payslip is information regarding the following: the amount that will be paid to the staff member, as well as any tax and insurance deductions that have been taken, if there is any to be taken at all.
Why are payslips important?
Payslips can be important for a number of reasons and have a variety of useful purposes. For example, payslips can be used as a vital piece of documentation to prove your earnings, the tax payments you have made, as well as any pension contributions you have paid.
Having proof of earnings in the form of a payslip can help with different stations, including if you are looking to rent or purchase a property, as it can be the case that you will be required to provide proof of employment in order to complete the contract.
In addition, having payslips can also be beneficial when applying for a loan. Many payday lenders or companies that offer personal and unsecured loans will require proof of income, and the simplest way is usually providing a payslip, confirming how much you receive in monthly earnings.
Does everyone receive a payslip?
No. There are some situations which mean you will not receive a payslip. This can include if you :
- Working as a contractor
- Are a freelancer
- Are in the police service
- Work as a merchant seaman
Details are shown on the payslip
As previously mentioned, the information that will appear on any payslip statement you receive will be as follows:
- Gross wages (i.e. the total wages you earn prior to other deductions)
- The individual amount of any fixed reductions
- The net amount of your wages (what you receive after-tax deduction)
- The total amount of deductions
- Individual amount of deductions made
A payslip from your employer will also usually include the following information:
- Your National Insurance number
- Any additional payments (for example, a bonus, overtime or tips)
- Your annual or hourly pay rate
- The tax code
When do you receive a payslip?
It is a legal requirement for your employer to give you a payslip, but how they issue one is flexible. For example, many employers these days decide that they would prefer to give a payslip through electronic means (email, online) instead of using paper slips, considered to be there more traditional approach.
What happens if there is a problem with my payslip?
From time to time, you may find yourself in a situation where there are inaccuracies with your payslip. But what should you do if that happens? It is recommended to always contact your employer as a first step to see if it can be sorted in-house. Otherwise, you could look at contacting a trade union or employee representative if you have them., to help provide guidance on what to do next.