Check Stub is a part of a paycheck that contains all the details about the employee’s pay. It enlists the wages that the employee earns for the period and also contains year to date payroll. It also contains details of the tax and other deductions made from the earnings of the employees. It explains the amount that the employee has received with all the deductions. You get to choose from options to give check stub to your employees in printed or electronic form.
Why are they used?
The paycheck stub includes information useful for both employee and the employer. Employees receive pay stubs as the records of their salary. With pay stubs, employees get a surety that they are paid correctly and can understand the deductions and the reasons.
Employers can use check stubs to settle any discrepancies with the employees regarding the pay. Any issues related to the pay can be resolved by referring to the check subs. The check stub maker also includes tax deduction details useful for filling out Form W-2 for Tax.
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Information included on the pay stubs
All the basic details related to pay for both employees and the employer are mentioned on the paycheck stubs to help both of them keep a track of earnings and deductions. Apart from the basic details about the employee, the paycheck contains details that can be divided into three parts:
1 Gross income and earnings: This includes the total earning the employee earned while working. This can be calculated and paid on an hourly basis or as a fixed paid salary. This section contains hourly rate, hours worked, and gross pay of the employee. This section also includes the number of days worked, overtime duration and pay, bonuses and payroll advances if any.
2. Taxes and deductions: This includes the earning that the employee does not take home. It includes taxes deductions and other contributions. The deductions might be of some insurance premiums, retirement plan contributions, charitable contributions, loan payments, or any other deductions.
3. Net pay: The net pay is the amount that is left over after all the deductions from the gross pay. This is the amount that the employee gets to take home. The net pay amount is the final amount that is written by the employer on the paycheck of the employee or is directly deposited in the bank account of the employee. The year to date and the current net pay for the pay period is mentioned on the paycheck stub.
The Paycheck stub clarifies the employees about their earnings and all the breakups of their wages. The check stub maker generates a format that is easy to understand by the employee and he could figure out every detail easily. If the employee does not understand the pay stub, you should make him clear about each detail mentioned in the pay stub.
Reviewing the pay stubs will also help you in bringing out any mistakes. Both employee and employer and clear out about the wage errors and can avoid any penalties with the help of pay stubs.
