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Your Payslip Explained

Updated:
January 19, 2023

In this breakdown we explain the different options you can select for your payslips.

Image of a Replacement Payslip with key details highlighted

1. Employee Number (optional)

Some companies don’t use this but you might call it your work id or something similar.

2. Employee Name

The format can vary. Sally James, Miss S James, etc.

3. Employee Address (optional)

Select a style that has allocated space (Plus, Prime & Security mailer) and you can add the home address. If you don’t need this it is better to select another style otherwise it doesn’t look correct.

4. National Insurance Number

Payslips would always usually include this. An exception is when someone has arrived in the UK and are awaiting their allocated number. You can find your NI number on any payslip, P60 or correspondence with HMRC.

5. Company Name & Address

Address is optional. On some layouts it may display shorter if it does not fit the space. It would always usually include name, town & post code. Other layouts can accommodate a longer address.

6. Pay Method

The choice would be BACS, Bank Transfer, Cash, and Cheque. On request we could use something else as long it was short ‘Other’.

7. Tax Code

The tax code you enter affects the calculations. It sets the tax free allowance. Unless you’re 100% sure it is best to let us calculate using standard codes for the period.

8. Pay Period

This is how often you receive pay. Weekly, Two Week, Four Week or Monthly. The period number is then displayed by calculating where the process date is in the payroll year. The year runs Apr 6th to April 5th the following year. In our example the date is 31st March which is the 12th period when paid ‘monthly’.

9. Process Date

This is the date of the payroll run. Not always the date money hits your bank. It’s best to keep a regular pattern. Every Thursday, last working day, last Friday of month, or last working day in the month.

10. 11. 12. Description of Payments

The first item will always show but the others are optional. They will display as Salary, Bonus & Commission but we can amend these on request. We could include Overtime, Car Allowance or something similar. They all contribute to the gross pay for the period and liable to tax, NI and other deductions.

13. Expenses (optional)

You can include a payment for expenses. It is not included in any of the deduction calculations but is part of the final net payment.

14. 15. 16. Units x Rate = Amount (optional)

Used to show hours or days worked (units), the pay rate per hour or day, and then the line total.

17. Notes Field (optional)

We have limited space where we can add some extra information such as holiday or bank payment detail. Keep it simple and under 20 words.

18. Tax Deduction

This is the tax due on earnings for the period. We calculate after deducting the tax free allowance which is set by the tax code. If employee lives in Scotland we use Scottish pay tables. You have the option to provide own figures if required.

19. National Insurance Deduction.

We’ll calculate the correct contributions based on salary for the period. You have the option to provide own figures if required.

20. Student Loan (optional)

We can calculate or you have the option to provide own deduction amount.

21. Healthcare (optional)

If you provide the amount this can will show as a deduction.

22. Pension EE (optional)

This is the employee contribution based on salary. We can calculate standard workplace pension or you can provide the figures. If there are no employer contributions the wording will show as ‘Pension’.

23. Pension ER (optional)

This is the company or employer payment and is not deducted from the salary. We can calculate as a workplace pension or you can provide the figures.

24. Employers National Insurance Contribution (optional)

If the earnings qualify the employer also pays NI and they can show on the payslip. We can calculate or you can provide the figures.

25. Period Summary

Shows the total earnings for this payslip. Also deductions for tax, national insurance and pension.

26. Years Summary

This shows the total earnings for the pay year from Apr 6th. Also tax, national insurance and pension.

27. Net Pay

This is the total of pay in this period less Tax, NI, Student Loan, Healthcare and Pension EE. It also includes any Expenses. This will be the figure paid to employee. It does not include the employers pension (ER) or NI contribution. They are not paid by the employee. They are payments made by the company to HMRC.

Notes: If a deduction item displays as 0.00 this would usually be because the pay was lower than required. Each has a threshold at which payments start to calculate.


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OSCP Online Store / OS Payroll
Newgate St, Morpeth, Northumberland
NE61 7ST