Are you wondering what goes on a paystub? Paystubs are important for your business and the ones you employ. A paystub has essential information. That helps payroll catch errors and helps your employees understand their paychecks.
If you need a refresher on what goes on a paystub, keep scrolling because, in this article, we are going over the info on a paystub and paystub samples.
What is a Paystub
A pay stub is the portion attached to your paycheck that has vital information. It lists details about the payment information for the employee. Taxes info and other deductions are also listed on a paystub. Paystubs are typically printed out, or they can also be electronically filed.
Some states require businesses to provide paystubs that have specific information. Check with your state to see what is required info needs to be on a paystub.
What’s the Purpose of a Paystub
The purpose of a paystub is the provide the employee with documentation of their paycheck. You can use a pay stub for employment verification and proof of income.
When you need to take out a loan or need to be approved for an apartment, they’ll most likely request the last two paystubs you earned.
What Information is on a Paystub Sample
Paystubs can be very detailed. They can have a lot of information on it, but for the most part, three basic parts are on every paystub. Let’s look into them.
The gross wages is the whole amount the employee earned before taxes and contributions. For hourly employees, the best way to calculate the gross wage is by multiplying their hourly rate by the number of hours worked.
To figure out the salaried worker’s gross pay, divide their salary by the periods in the year. Gross pay also includes additional income that the employee earned. This includes overtime, bonuses, or time-and-a-half.
Net pay is the amount left after taxes, deductions, and contributions have been deducted. This is the amount that the employee gets to cash or gets direct-deposit into their bank account.
Deductions and earnings always itemize paystubs. This way, you can easily check for accuracy, and payroll can see any errors present on the pay stub.
Taxes, Deductions, and Contributions
Taxes, deductions, and contributions are taken out of your gross pay. once these are taken out, this leaves you with your net pay (take-home pay). Deductions on your paystub usually include the following.
- Federal tax
- State tax
- Medical insurance
- Retirement fund
- FICA Tax
- Local income tax
Each contribution and deductions are listed on their own line. If you’d like to get an idea of what a pay stub looks like, check out these amazing paystub samples.
Understanding Paystub Info
Every business owner needs to know about their employee’s paystubs. If an employee gets fired or quits, knowing their paystub info makes the process easier. When you finally invest in paystubs for your business, ask for paystub samples, and choose the best one that fits your business’ needs.
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