What does it mean to have a pay stub, paycheck stub, salary slip, or payslip?

A pay stub, paycheque stub, payslip, or salary slip refers to the same document, and these terms are often used interchangeably. Essentially, it is a receipt given by an employer to an employee which contains important information such as the employee’s gross income, deductions, taxes, and net income.

When employers pay their employees through cheques or direct deposit, they usually provide a pay stub or payslip along with it. The terms pay stub and paycheck are often used interchangeably to refer to this receipt. The pay stub serves as a supporting document that accompanies your paycheque.

Which information is included in a pay stub

By looking at a pay stub, you can gain insight into the distinction between your gross salary and your net salary. Your gross salary is the income that appears on all company documents and serves as a reference point for recruiters. However, on the contrary, the net salary mentioned in your salary slip is the amount of money that you actually receive for the work done in the company.

There is the key information you will find on a regular pay stub:

  • Employer Name, Employee Name, and Dates

On a regular pay stub, you will find key information, including the name of your employer, your name, and the dates of your employment. While it may seem minor, it is important to make sure that this information is accurate and legible. This information serves as proof of your employment and the duration of your engagement with the employer.

  • Gross Salary

Your gross salary, as mentioned on your pay stub, is the amount your employer pays you before any mandatory deductions, taxes, benefits, or other charges are taken out. This amount should match what is mentioned on your employment contract. Your gross salary serves as the basis for calculating your annual income tax liability, along with other deductions.

  • Federal Taxes (If any)

On your pay stub, you will also find the details of the federal taxes you are obligated to pay as an employee in the country where you work. Even if you are not a citizen of that country, you may still be required to pay federal taxes according to the country’s regulations.

  • State Taxes (If any)

These are taxes that are specific to the state or province in which you work. Each state has its own tax slabs on which you are charged.

  • Back pay or Dated Pay

Back pay or Dated Pay refers to the money that your employer owes you but has not yet paid. This could include payments that were due in previous months or other outstanding payments that you are yet to receive.

  • Net Salary

After deducting all the necessary charges, taxes, and contributions from your gross salary, you receive the net salary amount. This is the precise amount over which you have complete control. Since taxes have already been deducted, this amount is not subject to further taxation.

What are the benefits of a pay stub?

Your pay stub is an essential record that can be used by various entities, such as lenders, recruiters, employers, or even the government, to verify your net income received either annually or monthly. Some of the common uses of a pay stub or a payslip are:

  • Used by Lenders to Determine Your Creditworthiness

Pay stubs are often used by lenders to verify your creditworthiness, which is an important factor when applying for loans or credit. Financial institutions use pay stubs as a proxy to determine your current and potential earnings. For example, banks may analyze your pay stub to calculate the net debt you may be eligible to receive for a house, car, education, or other personal reasons.

  • Used by Recruiters to Verify Your Employment History

Recruiters and potential employers use your pay stub to verify your employment history. It is essential that your pay stub accurately shows your name, your employer’s name, and the date of employment. Employers use this information to determine your offered salary and calculate the deductions and benefits you are eligible for.

  • Used for Ad Hoc Purposes

Pay stubs can also serve other ad hoc purposes such as personal record-keeping, identity verification, serving as a witness in legal proceedings, or even as evidence for prenuptial agreements.


Paystubs offers regular paycheck stub templates to help employees generate their pay stubs within seconds. We also enable our customers to customize their pay stubs as per the layout and requirements of their businesses.