To Employee, from Employer: What Information to Put on Your Pay Stub Paper

To Employee, from Employer: What Information to Put on Your Pay Stub Paper

You’re running a company and have new employees. Congrats!

There are myriad responsibilities you’ll need to take care of when it comes to dealing with your employees, and creating pay stub paper for each of them is likely one.

But if you aren’t using a payroll company that takes care of all the pay stubs for you, you might have to create pay stubs for your employees in-house.

And the challenge can be figuring out what information needs to go on there and what doesn’t.

That’s why I put together this post that’s a primer on the vital information that every pay stub paper needs to have on it.

So you can rest assured that the pay stubs you’re providing to your employees have everything you and they need on there.

Sound interesting? Keep reading to find out more!

Pay Stub Paper Options

Some employers decide to go with the traditional payment system of having checks and pay stubs that come with them.

If you’ve ever worked for a company that issued paper checks, the pay stub was likely attached and had all the vital information you’d need.

Other employers utilize the benefits of digitally based transactions and go with direct deposit for their employees.

In that case, there isn’t necessarily a pay stub in the standard sense. So you might be in a situation where you need to provide pay stub paper for your employees.

Fortunately, there are great resources online to create pay stubs, like https://www.thepaystubs.com/

Why It’s Important

For you, the employer, a pay stub is proof that you are making payments to your employees as your contracts or agreements with them have stipulated.

It also shows that if you are supposed to withhold taxes or deduct fees from their paycheck, you have done so.

And from the point of view of your employees, pay stubs are a tangible form of verification that they’ve been paid.

They can see clearly that their paycheck or direct deposit reflected the correct amount and had the correct amount of deductions or fees taken out from it.

Required Elements

The three primary areas that are required on a pay stub paper are gross wages, taxes, deductions & contributions, and net pay.

Gross Pay

This is a fairly simple equation. It reflects the number of hours worked times the amount per hour that your employee was paid.

Or, if they are a salaried worker, it should reflect the yearly pay divided by the number of payment periods.

So, following the employee name, the pay period and date should come their hours worked and their pay rate. And after that, their gross pay should be clearly marked.

Taxes, Deductions, and Contributions

You need to include lines for any deductions the IRS and state tax departments have taken out of the employee’s check.

If your employee contributes to insurance premiums or retirement plans, these must be clearly marked as well. Same goes with any payments towards loans, charity giving, and any other voluntary donation they’ve made.

And if you make employer contributions that aren’t deducted from the paycheck, like the employer part of the FICA tax, you should note these as well.

Net Pay

Finally, you need to include their net pay, aka what they are actually taking home in leftover compensation.

Pay Stubs Are an Important Record

Now you can see why giving an employee a pay stub paper provides them with an important record of their take-home pay, as well as what has been taken out of their gross pay.

For more information, check out this blog post on taxes for small businesses.

You’re running a company and have new employees. Congrats!

There are myriad responsibilities you’ll need to take care of when it comes to dealing with your employees, and creating pay stub paper for each of them is likely one.

But if you aren’t using a payroll company that takes care of all the pay stubs for you, you might have to create pay stubs for your employees in-house.

And the challenge can be figuring out what information needs to go on there and what doesn’t.

That’s why I put together this post that’s a primer on the vital information that every pay stub paper needs to have on it.

So you can rest assured that the pay stubs you’re providing to your employees have everything you and they need on there.

Sound interesting? Keep reading to find out more!

Pay Stub Paper Options

Some employers decide to go with the traditional payment system of having checks and pay stubs that come with them.

If you’ve ever worked for a company that issued paper checks, the pay stub was likely attached and had all the vital information you’d need.

Other employers utilize the benefits of digitally based transactions and go with direct deposit for their employees.

In that case, there isn’t necessarily a pay stub in the standard sense. So you might be in a situation where you need to provide pay stub paper for your employees.

Fortunately, there are great resources online to create pay stubs, like https://www.thepaystubs.com/

Why It’s Important

For you, the employer, a pay stub is proof that you are making payments to your employees as your contracts or agreements with them have stipulated.

It also shows that if you are supposed to withhold taxes or deduct fees from their paycheck, you have done so.

And from the point of view of your employees, pay stubs are a tangible form of verification that they’ve been paid.

They can see clearly that their paycheck or direct deposit reflected the correct amount and had the correct amount of deductions or fees taken out from it.

Required Elements

The three primary areas that are required on a pay stub paper are gross wages, taxes, deductions & contributions, and net pay.

Gross Pay

This is a fairly simple equation. It reflects the number of hours worked times the amount per hour that your employee was paid.

Or, if they are a salaried worker, it should reflect the yearly pay divided by the number of payment periods.

So, following the employee name, the pay period and date should come their hours worked and their pay rate. And after that, their gross pay should be clearly marked.

Taxes, Deductions, and Contributions

You need to include lines for any deductions the IRS and state tax departments have taken out of the employee’s check.

If your employee contributes to insurance premiums or retirement plans, these must be clearly marked as well. Same goes with any payments towards loans, charity giving, and any other voluntary donation they’ve made.

And if you make employer contributions that aren’t deducted from the paycheck, like the employer part of the FICA tax, you should note these as well.

Net Pay

Finally, you need to include their net pay, aka what they are actually taking home in leftover compensation.

Pay Stubs Are an Important Record

Now you can see why giving an employee a pay stub paper provides them with an important record of their take-home pay, as well as what has been taken out of their gross pay.

For more information, check out this blog post on taxes for small businesses.

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