A pay Stub also known as a pay slip is a kind of document that contains detailed information about the employee’s salary, wages, and tax deductions details. Modern employers generate Pay Stubs using an ePayStubs generator or online ePaystubs generator and provide them to their employees during the salary day.
This article briefs about the importance of having proper Pay Stubs.
What is Pay Stub?
Before getting into the core topic, let us brush up on some basics on pay stubs.
A pay stub is a payment statement or a financial record of the earnings provided by employers to their employees. The Pay Stub helps employees to understand and verify the payments, taxes, contributions, and deductions were accurate. In addition, it can be proof of income that can be used for various purposes, particularly for getting loans and so.
The usage of Pay Stubs was common among all companies and employers before the implementation of digital banking. However, still, some employers, contractors, small business owners; freelancers are using Pay Stubs via Online ePayStubs Generator for Businesses as a financial record.
List of Information Contain In a Pay Stub
Pay Stubs play a major role among employees examining the breakdown of their payments. Here are the lists of some vital information a typical Pay Stub may have.
- Details of employee (Name, SSN, Address, and so)
- Details of the employer (Name, company details, address, and so)
- Details of payment (pay period, pay rate, payment date, gross earnings, taxes, deductions, and so)
- Details of employee contribution (retirement plans, pensions, and so)
- Details of deductions (health insurance, family allowances, and so)
- Details of employee’s working hours for the pay period
- Additional Information (leave information, overtime details, and so)
For employees, it is important to review every paystub, so that they can ensure all the information provided by the employer is accurate and to avoid hiccups at the end. In addition, here are the few key benefits employers and employees can gain through having a Pay Stub
Benefits of Having Easily Accessible Pay Stub
For both employers and employees having an accurate pay stub is critically important. For employers, it is essential to have easily accessible paystub details so that they can ease the process of starting a new business fully in compliance with the law.
On the other hand, employees need to keep their pay stubs for various reasons apart from income verification. The upcoming lists will elaborate on why an employee should keep their pay stub safe.
- To keep track of monthly income & expenses: Pay stub provides clear records of how much an employee earned after all those deductions during the pay period. This helps employees keep track of their income and plan their expenses accordingly.
- To calculate tax withholdings: Pay stubs are generated on accumulating all the information of both federal and state taxes along with other deductions. This helps employees to examine whether the right amounts are deducted and crosscheck the tax withholdings.
- To protect against fraud: Apart from helping employees with accurate budgeting and perfect financial planning, Pay Stubs are useful for employees to protect against fraud or errors in their pay details. If they identify any issues, they can quickly bring those to the payer’s attention and sort them out.
Let’s Wrap It Up:
It is undeniable; pay stubs are important documents for both employers and employees. They play a key role in budgeting and financial planning. For employees, pay stubs are the only source to identify any discrepancies in their payments and to rectify them.
Understanding the importance of this financial tool Paystub and keeping them safe will be useful for employers and employees.