What is gross pay on a payslip?
Gross pay is your total earnings before any deductions are applied. It includes your basic wage plus any overtime, bonuses, commission, tips processed through payroll, and statutory payments such as statutory sick pay (SSP) or statutory maternity pay (SMP). Income tax, NI and pension are all calculated as a percentage of your gross pay.
Why is my NI different from my colleague's?
NI is calculated on your gross earnings in each individual pay period, not annually. If your hours or bonus vary, your NI will vary too. Additionally, different NI category letters apply to different workers — for example, employees over state pension age pay no NI (category C), married women who elected pre-1977 reduced rate use category B, and some apprentices use category H. Your NI category letter should appear on your payslip.
What does PAYE mean on a payslip?
PAYE stands for Pay As You Earn. It is the HMRC system by which your employer collects income tax and National Insurance from your salary before paying you, then passes those amounts directly to HMRC. Your tax code (for example, 1257L) encodes your tax-free personal allowance, allowing your employer to apply the right deductions in each period without you having to file a tax return.
Can my employer deduct money without telling me?
No. Under the Employment Rights Act 1996, the only deductions permitted are those required by law (tax, NI), expressly set out in your employment contract, or specifically consented to in writing by you. If an unexpected or unexplained deduction appears on your payslip, ask your employer for a written explanation. You can challenge unlawful deductions at an employment tribunal within three months of the deduction.
What is P60 and when do I get it?
A P60 is an annual certificate summarising your total pay, income tax and NI for a completed tax year (6 April to 5 April). Employers must issue P60s by 31 May each year. Your P60 for 2026/27 must be provided by 31 May 2027. Keep your P60 safe — you will need it to claim tax refunds, complete self-assessment returns, apply for tax credits or verify your income for mortgage applications.