Your payslip is a legal requirement — every employer must provide one on or before each payday. But the mix of abbreviations, codes, and figures can be confusing. This guide breaks down each section so you can verify your pay is correct.
The key sections of a payslip
While layouts vary between employers, every UK payslip must include:
- Gross pay (before deductions)
- Variable deductions and their amounts (tax, NI, student loan, pension)
- Net pay (your take-home pay)
- Fixed deductions (if any, listed at least annually)
Gross pay
This is your total earnings before any deductions. It includes your basic salary, overtime, bonuses, commission, and any other taxable payments. If you are paid monthly, this is your annual salary divided by 12 (plus any variable pay that month).
You may also see gross pay year-to-date (YTD) — the total you have earned since 6 April (the start of the tax year). This is useful for checking your tax is being calculated correctly on a cumulative basis.
Income tax
The income tax deducted is based on your tax code and your cumulative earnings for the year. Your employer divides your annual Personal Allowance across pay periods (e.g. £1,047.50 per month for code 1257L), then taxes everything above that using the applicable rates.
If you see more tax being deducted than expected, check your tax code (shown on the payslip). See our tax codes explained guide for help decoding it.
National Insurance (NI)
NI is calculated on a pay-period basis (not cumulatively like income tax). For 2026/27, you pay 8% on monthly earnings between £1,048 and £4,189, and 2% on anything above £4,189. If your monthly pay changes significantly (e.g. a bonus month), NI will spike for that month.
Your payslip shows your NI category letter (usually "A") and the amount deducted. See our National Insurance guide for the full rate breakdown.
Student loan
If you have a student loan, your payslip will show the plan type and the deduction. This is 9% of earnings above your plan's threshold (or 6% for Postgraduate Loans). The deduction is calculated per pay period, similar to NI.
If you believe your loan is fully repaid but deductions continue, contact the Student Loans Company — your employer cannot stop deductions without instruction from SLC.
Pension contributions
Your payslip shows both your contribution and (often) your employer's contribution. Under auto-enrolment, the minimum total is 8% of qualifying earnings (5% employee + 3% employer). If you use salary sacrifice, your contribution appears as a reduction to gross pay rather than a deduction from net pay — look for a line like "Salary Sacrifice Pension" in the payments section.
The difference between salary sacrifice and net-pay pension schemes affects your take-home pay. Use the salary sacrifice calculator to compare.
Other common deductions
- Cycle to Work scheme — salary sacrifice for a bicycle; reduces gross pay.
- Childcare vouchers — salary sacrifice (closed to new entrants but existing members continue).
- Season ticket loan — a repayment to your employer for a travel loan; not a tax deduction.
- AVC (Additional Voluntary Contributions) — extra pension payments above the minimum.
- Union fees — deducted after tax (but you can claim tax relief on them via HMRC).
Net pay (take-home pay)
This is what lands in your bank account: gross pay minus all deductions. If it does not match what you expected, work backwards through each deduction to find the discrepancy.
Use the income tax calculator to model your expected take-home pay and compare it against your payslip. If there is a consistent difference, your tax code or pension setup may need checking.
Employer costs (not deducted from your pay)
Some payslips show employer-side costs for transparency. These are not taken from your salary:
- Employer NI — your employer pays 13.8% on your earnings above £175/week. This is their cost, not yours.
- Employer pension contribution — their share of your pension pot.
- Apprenticeship levy — only applies to large employers.