Money might not always equal happiness, but an accurate payslip does…
Whether you've just started your first job or switched to a new employer, checking your payslip is essential. Getting familiar with what should (and shouldn't) be on there could save you from any surprises - and help you spot when something's gone wrong.
Here’s everything you need to know about payslips, from the legal requirements to decoding those confusing abbreviations:
What is a payslip?
A payslip is a document that shows a summary of your earnings and deductions. Your employer must provide one if you're an employee or 'worker' - although this doesn't apply to contractors, freelancers, police officers, merchant seamen, or crew members in share fishing.
You'll receive your payslip on or before payday, either as a printed document or electronically (often called an ePayslip). Most employers these days opt for digital versions, which are just as valid as paper ones.
According to HMRC guidance, your employer must provide this whether you're paid weekly, bi-weekly, or monthly.
Payslip example
Here is an example of what a typical payslip looks like:
Do I need to keep my payslips?
Absolutely. Your payslips serve as proof of earnings, tax paid, and pension contributions. They're particularly useful if you need to claim state benefits or query your pay.
HMRC recommends keeping payslips for at least 22 months after the end of the tax year they were issued in.
If possible, you should hang onto them longer - along with your P60s (annual tax summaries) and P45s (documents you receive when leaving a job).
What your payslip must show
By law, every payslip must display five key pieces of information:
1. Gross pay
This is your full pay before any deductions - including bonuses, commission, and overtime.
2. Variable deductions
These change from payday to payday and include tax and National Insurance contributions. The amounts will fluctuate based on your earnings and circumstances.
3. Fixed deductions
Deductions that stay the same each pay period, such as union dues or loan repayments. Your employer doesn't need to detail what these are for on your payslip, but they must provide a separate statement at least once a year explaining them.
4. Net pay
This is the amount that actually lands in your bank account - your take-home pay after all deductions.
5. Part payment details
If you're paid through different methods (for example, some cash and some bank transfer), this section breaks down the amounts and methods.
Additional information on your payslip
Beyond the legal requirements, you might see several other items:
- Payroll number - Your unique identifier within the company's payroll system
- Tax period - Shows which tax period this payslip covers (for monthly pay, 01 = April, 12 = March)
- Tax code - Indicates your tax rate (we'll explain these below)
- National Insurance number - Confirms you're eligible to work in the UK
- Expenses - Reimbursements for travel costs, meals, or other business expenses
- Pension contributions - Amount you're contributing to your workplace pension
- Student loan repayments - Automatic deductions if you're repaying student loans
- Workplace benefits - Value of benefits like health insurance or company cars
Can workplace benefits schemes save you money?
Decoding your payslip
Common payslip questions answered
What does year to date mean on payslip?
Year to date (YTD) shows your cumulative earnings and deductions from the start of the tax year (6 April) to your current pay period.
What is net pay on a payslip?
Net pay is your take-home amount - what you actually receive after all deductions.
What is back pay on a payslip?
Back pay covers any money owed to you from previous pay periods, such as delayed pay rises or overtime payments.
What is EE NI on payslip?
'EE NI' stands for Employee National Insurance - your National Insurance contributions.
What is employer NI on payslip?
This shows what your employer pays in National Insurance contributions on your behalf (you won't see this deducted from your pay).
What is EES pension on payslip?
'EES Pension' refers to Employee Pension contributions - money deducted for your workplace pension.
What is a payroll number?
A payroll number is how the payroll department at your company distinguishes between each employee. Your payroll number will usually be found on your payslip.
Understanding tax codes
Your tax code tells your employer how much tax to deduct. Most codes start with a number (which is your tax-free allowance divided by 10) followed by a letter:
L - You get the standard Personal Allowance
M - You've received 10% of your partner's Personal Allowance through Marriage Allowance
N - You've transferred 10% of your Personal Allowance to your partner
W1, M1, or X - Emergency tax codes, meaning you'll pay tax on everything above your Personal Allowance
For example, tax code 1257L means you can earn £12,570 before paying Income Tax.
Find out more in our detailed tax codes guide.
Common payslip abbreviations explained
- BACS - Bankers Automated Clearing Services (electronic payment system)
- CHB - Child Benefit
- CTC - Child Tax Credits
- HMRC - HM Revenue and Customs
- LEL - Lower Earnings Limit (minimum for National Insurance)
- NIC - National Insurance Contributions
- PAYE - Pay As You Earn (tax system)
- PILON - Payment in Lieu of Notice
- PP - Personal Pension
- SAP - Statutory Adoption Pay
- SMP - Statutory Maternity Pay
- SPP - Statutory Paternity Pay
- SSP - Statutory Sick Pay
- YTD - Year To Date
How to read a payslip
Don't just glance at the final figure - take time to review your payslip properly:
- Check your gross pay matches expectations - including any overtime or bonuses
- Verify tax and National Insurance deductions look reasonable
- Confirm pension contributions are correct
- Match the net pay with what you received in your bank account
- Review any expenses or benefits listed
If something doesn't add up, don't hesitate to contact your HR or payroll department. It's better to query potential mistakes early rather than let them add up over time.
You might also want to use our tax calculator to double-check your deductions.
Frequently asked questions
What should a payslip look like?
A payslip should clearly show your gross pay, all deductions (both variable and fixed), and your net pay. It should include your personal details, payroll number, tax code, and the pay period it covers. The layout can vary between employers, but the essential information must always be present.
What does a wage slip look like for different employment types?
Full-time employees will see regular monthly or weekly payments with standard deductions. Part-time workers might see variable hours and pay. Temporary workers may have different tax codes or fewer benefits listed. The basic structure remains the same regardless of employment type.
Can I get a payslip if I'm self-employed?
No - if you're a self-employed contractor or freelancer, you won't receive payslips. Instead, you'll receive invoices for your services and handle your own tax through Self Assessment.
What if my payslip is wrong?
Contact your payroll department immediately. Keep records of the error and any correspondence. If you've been overpaid, your employer will usually recover this from future payments. If you've been underpaid, they should correct this in your next payslip.
How long should I keep old payslips?
HMRC recommends at least 22 months after the tax year ends, but keeping them longer is wise. They're useful for mortgage applications, benefit claims, and resolving any future pay disputes.
Can I access old payslips?
Most employers with digital systems allow you to access previous payslips online. If you're struggling to find old payslips, contact your former employer's HR department - they should be able to provide copies.
Final thoughts
Understanding your payslip is just the start of taking control of your finances. Regular checks help you spot errors, track your earnings growth, and plan for the future.
If you think you might be paying too much tax, our guide can help you work out if you're due a refund. And if you're considering a career move, use our salary checker to research what you could be earning in different roles.
Remember - your payslip is proof of your hard work paying off. Make sure you're getting everything you're entitled to.
For more information, visit the Money Helper guide on understanding your payslip.
Paying too much tax? Here’s what to do next
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4 responses to “Payslip checker: How to read a payslip”
Hi, can anyone explain to me what PS2 Auto EEs % mean on my payslip.I have checed previous ones and I didn't have that.I did one day of overtime which is £237.95 before tax on payslip but I only get £103 more instead around £180.It showing PS2 Auto EEs % £57.74.Many thanks.Peter
Pension Savings Employee's percentage - this is the auto-enrolled pension scheme. Your employer has probably just started to offer this, as all employers with at least 1 employee is now required to do so. All employees are now automatically enrolled into their company's pension scheme, unless they opt out. You would need to check with your payroll section i) what the exact percentage is and ii) whether it applies to overtime payments as well as basic pay.
Hope this helps
Pensions Savings Employee's % - it is now a requirement of all employers that pay through the PAYE system to offer a pension. Employees are automatically enrolled, unless they opt out and in some cases, the employer pays into the scheme as well. The requirement has been phased in over the past few years and it may be that the size of the company you work for means that its phase date is towards the end of the project.
To find out what your deduction percentage is, you will need to contact your payroll section and find out if the deduction is applicable on overtime payments as well as basic pay.
Hope this helps.
can anyone tell me what ins . services mean?