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Sample Pay Stub: What Needs to Be Included
Are you the manager or owner of a company who needs to create a sample pay stub for use in your business? Do you know the specific items and categories that should normally be included on sample pay stubs, categories that are necessary for making these documents legal? While a sample standard pay stub may seem like a small or trivial business detail, the truth is that these documents serve a very useful purpose for both you and your employees. To illustrate this, in the following article we will highlight the various reasons that pay stubs are so essential, followed by an outline detailing the various categories and/or topics that should always be included when creating a sample pay stub template.
Sample Pay Stubs: Why Are They So Important?
So why is it important to create a sample pay stub template—one that can help you easily formulate, print, save and issue pay stubs to your employees? Actually, there are a number of reasons, each of which is equally important. Here’s an example:
• Speeds Up the Process of Creating Pay Stubs. With a sample standard pay stub you can transform what used to be a very long and arduous process into one that takes but a few minutes of your time and very little effort. Once you initially enter all of the necessary categories and formulas, typically using a spreadsheet program such as Excel, all you’ll need to do from that point forward is input the number of hours each employee worked during a given pay period, along with his/her hourly rate. From there, Excel will perform all of the necessary calculations to determine the employee’s net and gross income, as well as the specific amounts to be withheld in each individual deduction category—including state and federal income tax, insurance and retirement benefits.
As you can see, a sample standard pay stub can be very useful to you as the employer, but aside from the fact that a sample pay stub will help expedite the process of issuing these payroll documents, it also serves a vital purpose for your employees. Naturally, having a written statement of earnings and deductions is an absolute must for employees when calculating their year-end tax, but in addition to this, a sample pay stub will also allow your employees to:
• Show proof of income. When attempting to buy a house, car or any other expensive item on credit, employees will need to show proof of their gross and net earnings and the frequency with which they get paid. To accomplish this, there is only one document that will suffice: a pay stub.
• Apply for public assistance. A sample pay stub will also be needed when applying for any type of public assistance, including help with emergency cash needs, housing and food costs.
Sample Pay Stubs: What Should Be Included on an Excel Pay Stub Sample?
While there are many different computer programs that can be used when creating a sample pay stub template, an Excel pay stub template gives you the most options, and the program is very easy to use. Below are just some of the topics that should always be included when developing one of these templates:
• Company Information. The company information section, which is really nothing more than the name and address of your business, is an item that must appear on your template, but the good news is that it will only need to be typed once. After that it can be used over and over again each pay period and with each employee record.
• Employee Information. Entering the personal and payroll information for each employee is really the only time-consuming aspect of creating an Excel pay stub sample, but fortunately, this too will only need to be created one time. Once this information is entered into the database it can then be used each time you create an employee pay stub. Additionally, this list can be easily updated in the event of an address change, change in job title or pay rate and when hiring new employees.
• Income Information. The income information consists of both gross and net income, also known as pre-tax and after-tax income respectively. These amounts are based solely on the employee’s hourly rate and the number of hours he or she worked in a specific pay period, including overtime hours and the appropriate pay rate. Once your sample pay stub is set up with the proper formulas, these amounts will be automatically calculated by the template.
Of course, the final portion of your sample pay stub will consist of a series of formulas created to calculate the appropriate percentages of the various employee deductions. These deductions include, but are certainly not limited to, local, state and federal income tax, social security, disability insurance, health benefits, pension, and retirement savings, along with any voluntary or charitable contributions the employee opts to have withheld from his or her earnings.