By definition, a pay stub is part of the information every employee receives regarding their paycheck and monthly earnings. Even though these documents are not required by law in every state, they are beneficial for the employers as much as they are for their workers.
When creating a real paystub, there are some things that you need to pay close attention to in order to add the right information and provide transparency. In this article, we are going to give you more information on some of the things you need to know before creating a pay stub.
Continue reading if you want to know which details are a must, how to create these documents, and why you need to implement all that information.
1. Add the net and gross wage
The first thing you need to know about the real paystub is that you need to add the wage of your employees. Some owners think that they can get away with just adding the net or the gross wage, but if you want to stay professional, and if you want things to be done by the book, you need to include both numbers in your check stubs.
Even though there is no exact rule on where you should put them, as you can see in a pay stub example, you should add first the gross wage, and you should add the net at the end, after all the things that are added and deducted. This will help your team understand the difference, and easily calculate things if needed.
2. Pay attention to the date
The way to create the best paystubs that will be clean, easy to understand, and still detailed is to pay attention to the dates you are adding. You should never forget the monthly dates, and you should never miss out on adding all the important dates and additional information.
Know that when you are creating a real paystub you have to include the payroll cycle, and this is needed because you can then easily calculate the hourly rates and the start and ending dates. Not every company starts the payroll cycle on the first of every month, so you should be clear with your employees on the real paystub.
3. You should always add your business’ information
Many owners make this mistake, and they only pay attention to the details they should provide about the team member. Yes, when you create the real paystub, you need to add their first, last name, address, and the last four digits of their social security number, but you should also put in the information about your company.
The check stubs should include the full name of your business – the name it was registered under, as well as the address. This will help out in case your employees need to provide the real paystub as proof of address, or if they need it as a legal document.
As you can see on PayStubsNow, you need to follow the specific guidelines on how to present your company as trustworthy and reliable, and by sharing the business information, you can show your transparency. Use a check stub creator if you are unsure of what you should add, and what needs to be included in these documents.
4. Don’t forget about the taxes
The next thing you should pay attention to when making the paystubs is the taxes. They need to always be included if you want your employees to trust you, and this will help them understand the difference between net and gross wage.
Experts suggest that you should put information about the federal as well as the state taxes, and if possible, you should also include the exact amount on the local taxes and additional withholdings.
You can use the calculator that you can find in the check stubs generator and you can add all the numbers step by step. Once again, this will help your team understand the math behind their wages, and they can see how much of their earnings are going on taxes.
5. Bonuses and deductions
When you create the real paystub, you need to add all the information about bonuses and deductions. As we mentioned before, the taxes are usually the biggest deduction and difference between the gross and the net, but you should also give out any additional information, and calculate other types of withholdings.
The other types of withholdings in the real paystub may include benefits, insurances, or retirement plan deductions. Try to add the specific amounts and how they are affecting the net wage.
After adding the deductions, you should also add more information on the bonuses or any additional money that your employees have earned during the payroll cycle. This could be overtime or anything else that affects their paychecks.
6. Hourly rates are a must
The last thing you need to pay attention to is the hourly rate. Not every company adds the rate in the real paystub, but if you want to be transparent, then you should add not only the regular rate your team has, but also if there are any changes in it.
Usually, when people work overtime, or when they work during weekends or state holidays, their hourly rate is bigger. So, you should add the number of hours they’ve worked with the normal hourly rate, and you should also add information about the raised, or in some cases, decreased rate.
These are some of the most important things you should pay attention to when creating paystubs. In case you need any help with them, you can always consult a financial advisor, or you can just use a template and write them.
Know that the real paystub will make a big difference in how you present your brand, and how you treat your employees. Creating these documents is a lot easier than many people think, and once you have a good template, you can just follow the outline and use it for all members of your team.