What is a pay stub?

Pay stub (definition)

A pay stub is a document that’s given to an employee each payday. It shows their total amount earned, less deductions for things like tax.

Pay stubs show income from salary, hourly wages or commission. They also list things like:

  • tax withheld
  • reimbursements for personal work expenses (like mileage or travel expenses)
  • deductions such as insurance and retirement
  • employer contributions toward insurance or retirement

They may also show other employee information such as the amount of vacation time owed or used. Pay stubs are also known as payslips, paycheck stubs, or pay advice.

Traditionally, the pay stub was a paper document attached to a physical cheque or included in a wages envelope. Today, most employers prefer to use electronic pay stubs. These can be emailed to employees or made available to them online.

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Disclaimer: This glossary is for small business owners. The definitions are written with their requirements in mind. More detailed definitions can be found in accounting textbooks or from an accounting professional. Xero does not provide accounting, tax, business or legal advice.