How to Make a Payslip: Step by Step Guide with a Free Generator
· 6 min read
To make a payslip, write the employer's name and the employee's details at the top, add the pay period and pay date, list every earning (basic pay, overtime, allowances, bonus), list every deduction (tax, social security or pension, loan repayments), then show gross pay, total deductions and net pay, which is gross pay minus deductions. The free Salary Slip Generator lays this out for you, adds up the totals and gives you a PDF, Word or Excel file.
A payslip (also called a pay slip, wage slip, salary slip or pay stub) is the statement an employer gives an employee each time they are paid. It explains how the amount that reached the bank account was worked out. Below is how to make one by hand or online, what it needs to show, and the special case of people who are self employed.
How to make a payslip in 7 steps
- Add the employer's details. Company or business name, address and, if you have one, a logo. Add a payroll or tax reference if your country uses one.
- Add the employee's details. Full name, employee number, job title or department. Many payrolls also show a tax or social security number here.
- Set the pay period and pay date. For example "1 to 30 September" and "paid 30 September". If pay depends on hours, add the hours worked and the rate.
- List the earnings. One line per item: basic salary or wages, overtime, allowances, commission, bonus, holiday pay. Add them up to get gross pay.
- List the deductions. One line per item: income tax withheld, social security or national insurance, the employee's pension or provident fund contribution, union fees, loan or advance repayments. Add them up to get total deductions.
- Work out net pay. Net pay = gross pay minus total deductions. This is the amount actually paid to the employee.
- Check, save and send. Make sure the net pay matches the bank transfer, keep a copy for your payroll records, and give the slip to the employee on or before payday as a PDF or printout.
What a payslip must include
The exact rules depend on the country (and sometimes the state), but almost every payslip carries the same core items:
| Section | What to show |
|---|---|
| Employer | Business name, address, logo, payroll or tax reference |
| Employee | Name, employee ID, job title, tax or social security number |
| Period | Pay period dates and the pay date |
| Earnings | Each payment line and the gross pay total |
| Deductions | Each deduction line and the total |
| Result | Net pay, and the payment method or bank account |
| Year to date | Optional: totals so far this tax year |
As one official example, the UK government's payslip rules on GOV.UK say a payslip must show earnings before and after deductions, the amount of any deductions that can change each time (such as tax and National Insurance) and the hours worked if pay varies with time worked, and that it must be given on or before payday. Other countries set their own rules, so check your local labour or tax authority before you rely on a format.
A simple payslip example
Here is how the numbers fit together for one month (figures are made up to show the arithmetic):
| Earnings | Amount | Deductions | Amount |
|---|---|---|---|
| Basic salary | 3,000 | Income tax | 350 |
| Overtime (10 hours) | 200 | Social security | 180 |
| Travel allowance | 100 | Pension contribution | 150 |
| Gross pay | 3,300 | Total deductions | 680 |
Net pay: 3,300 minus 680 = 2,620. That 2,620 is the figure that should match the bank transfer.
How to make a payslip as an employer
If you run payroll for staff, the payslip should come straight from your payroll records, not be typed up separately afterwards. That way the figures on the slip, the tax you report and the money you pay all agree.
- Use payroll software if you have several employees or a tax system that changes often. It works out the deductions and produces the payslips for you.
- Use a payslip template or generator if you have a few staff and already know the deduction amounts, for example from your accountant or your tax authority's calculator.
- Number each slip or file it by month and employee, so you can find it quickly when an employee asks for a copy for a loan, a lease or a visa.
The tax and social security amounts are the part to get right. They depend on your country's rates and on the employee's situation, so take them from your payroll system, your accountant or the official calculator rather than guessing.
How to make a payslip for a small business
Small businesses with one to ten people often do not need full payroll software. A practical routine:
- Keep one record per employee with their pay rate, tax code or status, and any regular deductions.
- Each payday, open the Salary Slip Generator, fill in the earnings and deductions, and let it total gross pay, deductions and net pay.
- Download the PDF for the employee, and the Excel file if you want a running record of every month in one place.
- Pay the net amount, and pay over the tax and contributions you deducted to the right authority by its deadline.
Keep your payslips and payroll records for as long as your tax authority requires. Employees regularly need old slips as proof of income.
How to make a payslip if you are self employed
If you are self employed, you are not your own employee, so in most places you do not receive a payslip. The UK GOV.UK page above, for example, says contractors and freelancers are not entitled to payslips. A slip you write for yourself is also not proof of income: banks and landlords know that anyone can type one.
What self employed people usually use instead:
- Invoices you sent to clients, which you can make with a free generator such as the commercial invoice generator. See how to write an invoice for the details to include.
- Bank statements showing the client payments arriving.
- Tax returns or the tax authority's own statement of your income.
- A letter from your accountant confirming your income.
The exception is if you trade through your own limited company and the company pays you a salary through payroll. Then the company is your employer and it should issue you a payslip like any other employee.
You can still use a payslip layout to track your own monthly drawings and set aside money for tax. Just keep it as a private record and never present it as an employer's payslip.
Mistakes to avoid
- Wrong deductions. A tax or contribution figure that is off makes the whole slip wrong. Take the amounts from payroll or an official calculator.
- Missing details. Leaving out the pay period, the employee ID or a deduction line makes the slip hard to check and less useful as a record.
- Net pay that does not match the payment. The net pay must equal what actually reached the employee's account.
- Old templates. Update the template when pay rates, allowances or deductions change.
- Fake payslips. A payslip must reflect pay that was really paid. Making a slip that does not match real pay to get a loan, lease or visa is fraud.
Make a payslip online for free
The TradingForms Salary Slip Generator puts earnings and deductions side by side, adds up gross pay, total deductions and net pay (with net pay in words), takes your logo, and downloads as PDF, Word or Excel, or prints. Your draft stays in your browser and nothing is uploaded. For other staff paperwork, see the free HR letter formats and business forms.
Frequently asked questions
How do I make a payslip?
Add the employer and employee details, the pay period and pay date, list every earning and every deduction, then show gross pay, total deductions and net pay (gross minus deductions). A payslip generator does the totals and gives you a PDF.
Can I make my own payslip?
An employer can make payslips for its staff with a template or generator, as long as the figures come from real payroll records. A slip you make for yourself is not proof of income, because a payslip has to come from the employer that paid you.
How do I make a payslip if I am self employed?
In most places the self employed do not get payslips. Use invoices, bank statements, tax returns or an accountant's letter as proof of income. If your own limited company pays you a salary through payroll, the company issues your payslip.
How do I create a payslip online for free?
Open the free TradingForms Salary Slip Generator, fill in the employer, employee, earnings and deductions, and download the payslip as PDF, Word or Excel. The totals and net pay are worked out for you.
What is the difference between a payslip and a wage slip?
None. Payslip, pay slip, wage slip, salary slip and pay stub all mean the statement of earnings, deductions and net pay an employee gets each payday.
How is net pay calculated on a payslip?
Net pay is gross pay (all earnings added together) minus total deductions (tax, social security, pension and any other deductions).