Pay slips and Pay stubs

On payday, you typically will get a paystub or payslip from your employer. The paystub or payslip is a document that informs the employee that their paycheck has been deposited into their account via direct deposit. If you do not have direct deposit, you will still get a paystub or a payslip that is part of your paycheck. The payslip or paystub will list all the detailed gross income information. It should also include: taxes, deductions, retirement plans contributions, insurance, garnishments, or other amounts that are taken out of the gross amount. You will ten be provided with your final net amount and it should include the year to date total. Some employers will even include your sick and vacation leave hours on the payslip or paystub.

How do I understand my payslip or paystub?

Since payroll tax laws are constantly changing, it can make reading your payslip or paystub a difficult challenge. There are 8-10 sections that make up your payslip or paystub: payslip details pay period section, summary section, hours and earnings, rate details, pre-tax deductions, after-tax deductions, tax withholding information, net pay, and sick or vacation leave.

Payslip Details

The easiest part of your payslip or paystub will be the payslip details section. This section will have your name, address and payroll type. The payroll type will state if you are an hourly or salary-paid employee and how often you are paid. Most paychecks are distributed bi-weekly or monthly.

Pay Period Section

The pay period section discusses more than just how often you are paid, it also specifies the calendar month and the pay date. Depending upon your employer, your payday could be on a different date from other people at your company. Some employers will make special arrangements for some employees and pay them on a weekly basis versus on a bi-weekly basis.

Summary Section

The summary section on your paystub or payslip will include your year to date and current gross earnings. The gross earnings are any money you make at your job before the taxes and deductions are subtracted.

Hours and Earnings

This section will provide you with the number of hours you worked for the pay period and some may include the year-to-date hours you have worked. It will also include the pay rate you are currently being paid. This amount will vary for an individual who is paid hourly versus someone who is paid salary.

Rate

This section is only included on employee's pay stubs or pay slips and will have the hourly rate or salary rate. It will be a detailed section that breaks down your hourly earnings rate into a biweekly or monthly rate detail. If you have worked overtime, this amount will be reflected in this section. Pre-tax Deductions - In this section it will list the current and year-to-date pre-tax deductions. It will list a description of the deductions such as Social Security and Unemployment.

 After-Tax Deductions

This section lists the current and year-to-date after-tax deductions. Some after tax deductions include donations to charitable organizations like the United Way.

Tax Withholding Information

This section describes the type of tax you are paying, such as federal or state. It will also list your marital status, exemptions, and any other money that is being withheld.

Net Pay Distribution

This section includes your bank name and other account information. It includes the net amount of pay that is being distributed to your bank account. If you have your total funds divided into two accounts or split into your checking and savings account, the amounts that are being distributed will be displayed in this section.

Sick or Vacation leave

This section describes how much sick and vacation leave you have available. It will provide a detailed list of how much sick and vacation leave you have used year-to-date and how much is left over as well as the rate you are paid for the sick and vacation leave.

Payroll Software

 Many businesses hire third-party companies to handle all of their payroll needs. A good payroll software will include pay stubs and access to an online site where employees can go in and view their pay stubs.

ADP Run

ADP Run is one of the best-selling payroll software programs on the market for small businesses. This software will include all the services you need for tax filing and other calculations. ADP Run is easy to use and comes with a step-by-step help section. When each payday approaches, ADP Run will generate a spreadsheet of all of your employees and the hours they worked for the pay period and for the year to date. At this point you can make any adjustments and then submit them to ADP Run.

From this point, ADP Run will calculate the taxes and deductions. Once the payroll is complete, ADP Run gives you the option of printing the paychecks and tax reports or it can automatically deliver them to the employees and local, state, and federal agencies. ADP Run now has a web site that allows your employees to log in and view their paystub or payslip before they can normally receive it in the mail.

If you are looking for a payroll program that will handle all your needs, then you need to purchase ADP Run. ADP Run will automatically generate the W-2s and allow you to view them online and print them for your employees. ADP Run will also file and pay your federal taxes electronically and will print the state and local tax forms. ADP Run will cost $29.99 a month and will take care of all your payroll needs.

iEmployee

 Another great payslip and paystub software program is iEmployee. This paystub software will produce bi-weekly pay stubs for your company and will also provide W2s. iEmployee's pay stub and W2 software will reduce your per-employee costs to move everyone online versus on paper. iEmployee will allow your staff members to receive email notices when their pay stubs are available. Your employees can go online when a new pay stub is issued and will be able to keep a historical record of their pay stubs. The software complies with state and federal laws. iEmployee will provide your company with an efficient program that allows universal access for all its employees. It will also reduce the payroll processing time and cost and provide an immediate cost-saving result to your manual paper-based solution.

QuickBooks

If you are currently running QuickBooks, you can purchase their payroll software, Intuit. The Intuit payroll program manages and pays employees, files proper local, state, and federal taxes, and provides W-2s. The Intuit Online Payroll program is easy to used and take a matter of minutes to set up. You will get an email notification when it is time to file your W-2s. Once you input your payroll information, the Intuit Payroll program will generate the required reports and print them for you. The Intuit Payroll program costs $29.95 a month.

Payroll Mate 2008

An easy payslip and paystub software is Payroll Mate 2008. This software can be purchased for $99 and it will include all the information you need to organize your company's payroll. It provides screen shots of the software so you can understand how it works and it includes online support.

Paychex

Paychex is another great payroll software that has been around since 2001. Paychex offers a simple solution to your complex payroll needs. Paychex offers solutions for human resources and payroll departments who do not have the time needed to dedicate to the current and changing payroll laws. If you are a small business, Paychex is an ideal solution since you can submit your information over the phone, fax, or internet. Paychex is an online payroll solution, but it does have software that you can install on your computer if you do not want to use the other methods to report your payroll.

At the end of each pay period, Paychex will automatically generate reports that summarize your employee's earnings, tax liabilities, department totals, and deposits. For an additional fee, you can use a tax service from Paychex. The tax service will calculate, file, and deposit your federal, stat, and local payroll taxes. Many employers like how Paychex is able to directly deposit the funds into their employee's accounts and then provide them with an easy-to-read payslip or paystub. Another great feature of Paychex is that they will provide a Visa Card that allows the employees to obtain their cash without having to open a bank account. Paychex will also mail your employees paystub with paycheck for an additional fee. The cost of Paychex will vary depending upon the number of employees you have, how often your employees are paid, and the extra services you may add. For companies who have retirement accounts like a 401(k) or Simple IRA, Paychex can automatically calculate the correct amount and display it on the paystub or payslip.

There are several other payslip and paystub companies who offer excellent solutions for your payroll needs. Many companies won't charge too much money for simple payroll needs like bi-weekly payroll that includes pay slips and pay stubs. If you want to provide a greater service to your employees, you can purchase a payslip service where they can log in online to view their current and past pay slips.