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Do you understand all the terms on your payslip each month? What about your employees?

The CIPP (Chartered Institute of Payroll Professionals) found that 26% of us don't understand everything on our payslip, that's more than 1 in 4 employees. This fact is really quite staggering, just take a look around your workplace and imagine that over a quarter of your colleagues didn't fully understand what was written on their last payslip.

Sometimes deciphering all the abbreviations and terminology on your payslip is like trying to read another language. But understanding what it all means is really important - how are you going to spot if you have been paid incorrectly if you don’t know what you are looking at?

So here are five of the common terms seen on a payslip with their definitions

Want to find out more? Download our PDF guide for employees covering the top thirteen payroll terms you need to understand (opens in a new tab).


This stands for Pay As You Earn, it is the system by which you pay both your income tax and national insurance (NI). Every time you’re paid, your employer takes your tax and NI from your wages and sends it on to HMRC.


The term for the amount of salary actually paid after the deduction of tax, national insurance and any other deductions.


This is the period for which the tax was calculated. For monthly pay it refers to the month of the tax year, with April being period 1 and March being period 12. If you are on a weekly payroll it refers to the week of pay, starting with week 1 in April to week 52 at the end of March.


This means “To Date” or “Year To Date”. As well as showing earnings and deductions for that specific pay period, your payslip should also show you a combined total for that tax year to date.


An ERN is given to every business that registers with HM Revenue and Customs as an employer. You may need this number when applying for tax credits, applying for Student Loans, or a range of other tasks, so your employer will sometimes put it on your payslip.

PayDashboard are official sponsors of National Payroll Week 2017

National Payroll Week celebrates the role of payroll in UK businesses, as part of this we are sharing five guides from 4th - 8th September aimed at helping payrollers and HR teams to educate employees about their finances and improve their financial well-being.

To receive these five free guides simply sign-up to our mailing list here. You'll receive all five user guides to your inbox. You can sign up anytime during or after National Payroll Week.

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