What is Payslip?
A Payslip, also known as a Wage Slip or Salary Slip, is a document provided by an employer to an employee after the salary payment for a given period. It details the employee’s earnings, deductions, and other relevant information, serving as proof of payment for the month. Payslips are particularly useful for employees who need to provide proof of income, such as when applying for loans or credit, as financial institutions often review them to determine eligibility and loan amounts.
Payslips generally consist of three main sections:
Basic Pay: The core salary an employee earns before any deductions or bonuses.
Taxes, Deductions, and Contributions: This section includes statutory deductions like taxes, Provident Fund (PF), insurance, and other contributions.
Net Pay: The final amount the employee receives after all deductions are made.
According to the Payment of Wages Act, 1991, all employees are entitled to receive a payslip, ensuring transparency and compliance with wage payment laws.