Payslip
What a payslip is, what it shows, and how to read one as a Canadian employee or employer.
Published Thursday 23 July 2026
Table of contents
Key takeaways
- A payslip is the document your employer gives you each payday that shows your total earnings less any deductions.
- In Canada, a payslip typically lists CPP or QPP contributions, EI premiums, and federal and provincial income tax alongside your gross and net pay.
- The Canada Revenue Agency requires businesses to keep payroll records for at least 6 years from the end of the year they relate to.
- A payslip is the record of what you earned, while the paycheque or direct deposit is the payment itself.
What is a payslip?
A payslip is a document your employer gives you each payday that shows your total earnings for the period, less any deductions taken out. It sets out what you earned, what was withheld, and what you're actually paid.
You might also hear it called a pay stub, pay slip, wage statement, or pay advice. They all describe the same thing: a written breakdown of your pay.
What's included on a payslip?
Most payslips follow a similar structure, whatever industry you work in. Here are the components you can expect to see:
- gross pay, including salary, hourly wages, and commission
- tax and other deductions
- employer contributions
- net (take-home) pay
- leave balances
Payslip components in Canada
A Canadian payslip includes a few items that are specific to how pay works here. These reflect the contributions and taxes an employer withholds when they run payroll.
- Canada Pension Plan (CPP) or, in Quebec, Quebec Pension Plan (QPP) contributions
- Employment Insurance (EI) premiums
- federal and provincial income tax
Vacation pay also appears on many Canadian payslips. Minimum vacation entitlements are set by federal and provincial or territorial employment standards, so the exact amount depends on where you work and how long you've been with your employer.
How to read your payslip
Reading your payslip gets easier once you know the difference between two key figures. Gross pay is what you earn before anything is taken out, and net pay is what lands in your account after deductions.
Your payslip also shows year-to-date (YTD) totals, which track your earnings and deductions across the year. Your T4 slip summarizes your annual income and deductions, and it should match the year-to-date totals on your payslips.
A few abbreviations show up on most Canadian payslips. Here's what they usually mean:
- CPP: Canada Pension Plan
- EI: Employment Insurance
- YTD: year-to-date
- OT: overtime
- Vac: vacation pay
Payslip vs paycheque
It's easy to mix up a payslip and a paycheque, but they're not the same thing. The payslip is the record of your earnings and deductions for the pay period.
The paycheque, or the direct deposit that's replaced it for most people, is the payment itself. In short, the payslip explains the money, and the paycheque delivers it.
Are employers required to provide a payslip in Canada?
Yes, in most cases. Employers are generally required to give employees a written statement of earnings each pay period, showing pay and the deductions made.
These rules come from the Canada Labour Code for federally regulated workplaces and from provincial or territorial employment standards for everyone else. Staying on top of payroll compliance is part of an employer's ongoing responsibilities.
How long should you keep your payslips?
Businesses have clear record-keeping duties when it comes to pay. The Canada Revenue Agency (CRA) requires businesses to keep payroll records for at least 6 years from the end of the year they relate to.
As an employee, it's worth holding on to your payslips and T4s too. They're handy proof of income when you apply for a loan or a rental.
Paper vs electronic payslips
Payslips have changed a lot with the shift to digital pay. Traditionally, a payslip was a paper document attached to a printed cheque.
Today most employers use electronic payslips, emailed to you or available to view online. Digital payslips are easier to store, search, and share when you need them.
Simplify payroll and payslips with Xero
Getting payslips right every pay period takes time, especially when you're tracking CPP, EI, and income tax by hand. Xero helps you run payroll and keep clear, organized records so your team always knows what they've earned.
You get accurate payslips, tidy payroll records, and more time to focus on your business, and you can get one month free to try it.
FAQs on payslips
Here are answers to some frequently asked questions about payslips for Canadian employees and small business owners.
Is a payslip the same as a pay stub?
Yes, they're two names for the same document. You might also see it called a wage statement or pay advice.
Are employers required to provide a payslip in Canada?
Employers are generally required to give a written statement of earnings each pay period. The specific rules depend on whether the workplace is federally or provincially regulated.
How long should I keep my payslips?
Businesses must keep payroll records for at least 6 years from the end of the year they relate to. Employees can keep their own payslips and T4s as proof of income.
What's the difference between a payslip and a paycheque?
The payslip is the record of your earnings and deductions. The paycheque or direct deposit is the actual payment.
What should I do if there's an error on my payslip?
Flag it with your employer or payroll contact as soon as you spot it. Keep a copy of the payslip and any correspondence until it's fixed.
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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.