Essential Guide To The Pay Stub Meaning
It is important to have knowledge of the items that are included in your pay stub. The stub which is used to show an employees pay is a portion of a paycheck. Employers are obligated by law to provide the pay stubs to their staff. The goal of the stub is to assist the employer and the employee to track the payments and deductions.
The categories under which you will find items on the pay stub include the net pay, gross wages and taxes, deductions and contributions. The gross wages represent the amount payable to the employee before any deductions have been made. How the wages are arrived at will depend on whether an hourly or salary rating is applied.
When you find PAYE in your pay stub, it stands for Pay As You Earn. This is a scheme where deductions meant for Her Majestys Revenue and Customs. The deductions are carried out by employers using the monthly or quarterly P32 payments.
Your pay stub will also have the abbreviation NI which is an acronym for National Insurance. This represents a mandatory deduction that is calculated as a fixed percentage of the earnings of a worker. Every employee has an NI category which gives the amount payable as the website states.
If as an employee are eligible for statutory maternity pay, this will be reflected in your pay stub as SMP. As a beneficiary you are entitled to a maximum of 39 weeks pay. The appearance of SPP on your pay stub indicates that you have qualified to be paid statutory paternity pay for a period of one or two full weeks.
The acronym YTD on your pay stub should be taken to stand for Year-to-Date. Alternatively, it can appear as YTD Earnings. This is a representation of your earnings calculated from the beginning of the year to the present time.
The federal tax or the federal tax withheld will be shown in your pay stub as FT/FWT. This is a deduction that is made on your paycheck and is remitted to the federal government. This amount can be changed by filling a new W-4 form.
You will normally find ST/STW acronym on your pay stub which stands for state tax or state tax withheld. You are required to pay this amount to the state where you are a resident. Depending on a particular state, there is no requirement to pay state income tax.
When you find SS/SSWT on your pay stub you should take to mean Social Security or Social Security Withheld Tax. The money is deducted from your paycheck by the government and is later deposited in a social security fund. Upon reaching a certain you can access the funds.