If you want to know how to read your payslip in the UK, start with one simple idea: a payslip tells the story of your pay in three parts — what you earned (gross pay), everything taken off (deductions), and what is left (net pay, the money that lands in your bank account). Every other line explains one of those three parts, or proves the figures are right.

Your employer must give you a payslip on or before payday, printed or electronic. It must show your earnings before and after deductions, the amount of any deductions that can change each time you are paid, such as Income Tax and National Insurance, and the number of hours you worked, if your pay varies depending on the time you worked. Most payslips show more besides, which is where confusion starts. This guide goes through every line you are likely to see.

How to Read Your Payslip in the UK: The 30-Second Check

Before anything else, run this quick check: do the pay date and period match the work you did? Is the gap between gross and net pay roughly as expected, and does net pay match your bank account? Has your tax code changed since last month, and do you know why? Do the hours shown match the hours you worked, including overtime? If all four answers are yes, the rest is detail; if any is no, the sections below will help you find the problem.

The Top of the Payslip: Who, When and How Often

The top of the payslip is mostly identification, but it matters when something goes wrong. Your name and your employer’s name should both be there, along with your payroll number. Quote that number in any query about your pay: it is how payroll tells you apart from colleagues with a similar name. Your National Insurance number may also appear. HMRC uses it to track your tax and National Insurance record, and it stays the same for life, whatever job you are in.

The pay period tells you which stretch of work this payslip covers, for example 1 to 31 October. The pay date is when the money is due. The two are not always in the same month, especially if you are paid in arrears — after the work is done. If you started halfway through a month, your first payslip usually covers only the days from your start date, which is why a first payslip is often smaller than expected. You may also see the payment method, usually bank transfer, and the tax period number: for monthly pay, period 1 is April and period 12 is March, as the tax year runs from 6 April to 5 April.

Gross Pay: Everything You Earned Before Anything Comes Off

Gross pay is everything you earned in that pay period before a single deduction — not just basic salary or hourly rate, but the total of every payment line above it, broken down so you can check it.

For salaried staff, the main line is basic pay, usually a monthly or weekly slice of your annual salary. For hourly-paid staff, you should see the hours worked and the rate for each type of work, because the law requires the payslip to show hours where pay varies with time worked. Overtime hours and the rate paid for them should appear as their own lines. Check these carefully: overtime is paid at whatever rate your contract sets, not at a rate fixed by law, so compare the figure against your contract. To check what a set of overtime hours is worth, use our overtime pay calculator.

Other payment lines may include bonuses, commission, shift allowances and holiday pay. Paid holiday is paid at your normal rate and forms part of gross pay like any other week. A separate holiday pay line sometimes appears when you are paid for untaken leave on leaving a job; you can check what that leave was worth with our holiday pay calculator. Statutory payments and any pay-rise arrears also sit in gross pay, as their own lines. Add the payment lines up yourself: if the total does not match gross pay, ask payroll why, because every deduction below is calculated from gross pay.

Your Tax Code, Decoded

Your tax code is the short string of numbers and a letter, usually near the top of your payslip, that tells your employer how much Income Tax to take from your pay. It is set by HMRC, not by your employer, and you get a separate code for each job or pension.

The most common code is 1257L, used for most people with one job or pension. The number is your tax-free Personal Allowance with the last digit removed: £12,570 becomes 1257. The letter L means you are entitled to the standard Personal Allowance. That allowance is spread across your pay periods, so on monthly pay you get £1,048.26 of tax-free pay each month, and on weekly pay £241.92 a week.

Other codes tell a different story. BR means all income from that job is taxed at the basic rate of 20%, with no tax-free allowance — common on a second job, where your Personal Allowance is already used up by your main job. A code starting with K means you have untaxed income or deductions worth more than your Personal Allowance, so an extra amount is added to your taxable pay; a K code can never take more than half of your pay in one pay period. Codes starting with S are for Scottish taxpayers and C for Welsh taxpayers, because Income Tax rates there are set differently.

If your code ends in W1, M1 or X, it is an emergency, non-cumulative code. It usually appears when you start a new job and your employer does not yet have your P45 or your details from HMRC, and it means tax is worked out on each pay period in isolation, without looking at what you have earned so far in the tax year. That often means you pay too much tax at first, and the overpayment is normally sorted out once HMRC sends your proper code. If your code looks wrong, check GOV.UK’s tax code pages and your Personal Tax Account, where HMRC shows how it was worked out.

Income Tax: How the Figure on Your Payslip Is Worked Out

Income Tax is taken through PAYE, Pay As You Earn. Your employer deducts it from your pay before you receive it, using your tax code and the tax bands for the year, and pays it to HMRC on your behalf.

For 2026/27, the standard Personal Allowance is £12,570. In England, Wales and Northern Ireland, income above that is taxed at 20% up to £50,270, at 40% from £50,271 to £125,140, and at 45% above £125,140. Scotland sets its own Income Tax bands. Your Personal Allowance falls by £1 for every £2 of adjusted net income above £100,000, reaching zero at £125,140.

Your tax can change from month to month even when your salary does not, because PAYE is cumulative for most people. Your employer looks at everything earned since 6 April and tax paid so far, then deducts the difference. A bonus month pushes more pay into tax, while a quiet month lets unused allowance catch up. A mid-year code change can also cause a sudden jump or drop, as the system corrects itself across the whole tax year.

National Insurance: The Second Big Deduction

After Income Tax, National Insurance is usually the next largest deduction, and it works differently from tax in one important way: it is not cumulative. Each pay period is worked out on its own, so a big bonus month can attract more National Insurance than the same amount spread evenly across the year.

For 2026/27, most employees pay Class 1 National Insurance at 8% on earnings between £12,570 and £50,270 a year, and 2% above £50,270. On monthly pay, that is 8% on pay between £1,048 and £4,189 a month, and 2% above £4,189. You pay nothing below £12,570 a year. Your employer pays a separate contribution on top of your pay, at 15% on earnings above £5,000 a year, but that is the employer’s cost, not a deduction from your wages — although some payslips show it for information, so do not mistake it for money taken from you.

Your payslip may also show a National Insurance category letter, usually A for most employees; other letters cover groups such as apprentices and employees under 21. If yours changes, ask payroll why. To check your own figure, use our National Insurance calculator. You stop paying employee National Insurance once you reach State Pension age.

Pension: The Line That Builds Your Future

If you are in a workplace pension, your contribution is usually the third deduction, and it is the one deduction that comes back to you later. Under automatic enrolment, employers must enrol eligible staff — those aged 22 to State Pension age earning at least £10,000 a year — into a workplace pension scheme and make minimum contributions.

The minimum total contribution is 8% of qualifying earnings, with the employer paying at least 3% and the employee paying the rest, usually 5% including tax relief. Qualifying earnings are the slice of pay between £6,240 and £50,270 a year, so the percentage is not applied to your whole salary: earnings below £6,240 and above £50,270 do not count towards the minimum. Many employers pay more than the minimum, and some schemes use your full salary instead, so your own figure may be higher — that is a good thing, not an error.

Your pension line may be labelled simply “pension”, or it may name your provider. If you opted out, there should be no deduction; if you opted back in, it should restart from the pay period you rejoined. An unexpected appearance or disappearance is usually a scheme membership question for payroll, not a tax question.

Other Deductions You Might See

A student loan deduction appears if you repay a student loan through PAYE, taken as a percentage of pay above your loan plan’s repayment threshold, stopping when the loan is repaid or written off. Salary sacrifice is different: you agree to give up part of your salary for a benefit, such as pension contributions or a cycle to work scheme, and the sacrificed amount is taken before tax and National Insurance are calculated, which lowers both.

Other lines are simpler: a season ticket loan repayment, a trade union subscription, or a charity donation through payroll giving, each as its own line. An attachment of earnings order, where a court has ordered deductions to repay a debt, will also be shown, as will recovery of an overpayment, which should be explained to you before it starts. Fixed deductions may be explained on the payslip or in a separate statement, updated at least every 12 months.

Net Pay and Year-to-Date Totals

Net pay is gross pay minus every deduction — the amount that should arrive in your bank account, and the first figure to compare against your bank statement. If net pay and the bank payment do not match, something has gone wrong between payroll and payment — a question for payroll straight away, not a tax question.

Year-to-date totals, usually on the right of the payslip or at the bottom, add up everything since 6 April: gross pay, tax, National Insurance and pension contributions. They let you check whether your cumulative tax looks right, and they are the figures you need to prove income for a mortgage, loan or tax refund claim. A P60, issued at the end of the tax year, is these totals in final form; a P45, issued when you leave a job, shows the same totals up to your leaving date.

Worked Example: A £2,500 Monthly Payslip, Line by Line

Imagine an employee in England, on the standard 1257L tax code, earning £2,500 gross a month (£30,000 a year), with a £100 monthly pension deduction and no other deductions.

Payslip line	How it is worked out	This month
Gross pay	Monthly salary	£2,500.00
Income Tax	(£30,000 − £12,570) × 20% ÷ 12	£290.50
National Insurance	(£2,500 − £1,048) × 8%	£116.16
Pension	Employee contribution	£100.00
Total deductions	£290.50 + £116.16 + £100.00	£506.66
Net pay	£2,500.00 − £506.66	£1,993.34

Tax is £290.50 because the taxable slice of £30,000 is £17,430, taxed at 20% (£3,486 a year). National Insurance is £116.16 because only monthly pay above £1,048 is charged, at 8%, and £2,500 minus £1,048 is £1,452. The pension figure is a round £100 for simplicity. The key check is the last line: £1,993.34 should reach the bank account. To check your own take-home figure, use our annual salary calculator.

The Hourly Check: Is Your Hourly Rate Right?

If you are paid by the hour, divide your gross pay by the hours shown and see whether the result matches your contracted rate. It is a quick way to catch missing overtime, a wrong rate, or hours never recorded.

Take a worker on £13 an hour doing 40 hours a week: gross weekly pay should be £520. First check against the legal floor: from 1 April 2026, the National Living Wage is £12.71 an hour for workers aged 21 and over, with £10.85 for 18 to 20-year-olds and £8.00 for under-18s and apprentices. At £13 an hour, this worker is above the floor. Second, check against the contract: if it promises £13 but the payslip works out at £12.71, something is missing, even though the legal minimum is met.

To check whether the hourly rate on your payslip matches your contract, use our hourly wage calculator: enter gross pay and hours, and compare the result with your contract rate. If your hours vary, remember full-time is not a single legal number — it usually means 35 hours or more a week, as explained in our guide to how many hours is full time in the UK. If your pay is quoted as an annual salary, our salary to hourly calculator converts it.

Five Payslip Mistakes Worth Checking For

Most payslips are right, but when they are wrong, it is usually one of these. First, the wrong tax code — the most common error, usually after a job change or a second job. If your code changed without explanation, or you are on BR with only one job, check it. Second, missing or wrong hours: a shift not recorded, overtime at the basic rate instead of the agreed rate, or a bank holiday paid as a normal day — compare the payslip with your rota. Third, pension contributions that do not match your scheme. Fourth, deductions you do not recognise: every deduction should have a label you understand. Fifth, net pay that does not match the bank payment — check it on payday, not at month’s end.

What to Do If Something Looks Wrong

Start with your own records. Keep your payslips — they prove your earnings, tax paid and pension contributions. Note the hours you actually worked, and keep your contract and any letters about your tax code.

Then raise it with payroll, in writing, quoting your payroll number and pay period. Most errors are simple mistakes, corrected in the next pay run, sometimes with arrears as a separate line. If the problem is your tax code, also check your Personal Tax Account on GOV.UK. If payroll cannot explain a deduction, or a problem repeats for months, get advice before it grows — your trade union, if you have one, can help. Do not ignore it: a wrong code left for a full tax year becomes a refund claim or a bill, and missing pension contributions are far harder to fix months later.

Sources

• GOV.UK — Understanding your pay (what a payslip must show)
• GOV.UK — Tax codes: what your tax code means (1257L, BR, K, emergency codes)
• GOV.UK — Income Tax rates and Personal Allowances (Personal Allowance £12,570; 20%, 40%, 45% bands)
• GOV.UK — National Insurance rates and categories (employee 8% and 2%; monthly thresholds)
• GOV.UK — National Minimum Wage and National Living Wage rates (National Living Wage £12.71 from 1 April 2026)
• GOV.UK — Workplace pensions for employers (minimum total contribution 8%; employer at least 3%; qualifying earnings £6,240 to £50,270)