Starting your first job is an exciting milestone, but when payday arrives, you might find yourself staring at your payslip unsure of what everything means. Here is a simple breakdown of the key elements of a payslip to help you understand where your money is going.
1. Employee details
Your payslip will include basic information such as your name, employee number, job title and possibly your tax reference number.
2. Earnings (your salary and benefits)
This section shows what you have earned before any deductions. Common earnings include:
- Basic salary: The agreed monthly wage before deductions.
- Bonuses or overtime: Any additional earnings for extra hours worked or performance incentives.
- Allowances: Some jobs provide travel, cell phone or housing allowances.
3. Deductions (What gets taken off)
Certain amounts are deducted from your salary before you receive your final pay, such as:
- PAYE (Pay-As-You-Earn): Your income tax, calculated based on your earnings.
- UIF (Unemployment Insurance Fund): A small percentage deducted to provide short-term relief if you become unemployed.
- Pension or retirement fund contributions: If your employer has a retirement plan, a portion of your salary may go towards your pension.
- Medical aid contributions: If you are part of a company medical aid, your contribution may be deducted here.
4. Net pay (your take-home salary)
This is the amount that will be deposited into your bank account after all deductions.
5. Employer contributions (additional benefits)
Some employers contribute towards your benefits, such as pension funds or medical aid. These contributions are not deducted from your salary but are reflected on your payslip as additional employer-provided benefits.
Final Tip
Always check your payslip to ensure that your salary, deductions and benefits are correct. If anything looks incorrect, speak to your HR or payroll department.
Have more payroll-related questions? Feel free to reach out – we are happy to help!