How to read your payslip

A payslip has four parts: details about you and the pay period, what you earned, what was taken off, and running totals for the tax year. The figures that matter most are your gross pay, your tax code, the income tax, National Insurance, pension and any student loan deductions, and the net pay that reaches your bank. Every employee and worker has a legal right to an itemised payslip, and it must show hours when your pay varies with the time you work.

The header: who, when and which codes

The top section identifies you and the pay run. You will usually see:

• your name, employee or assignment number, and sometimes your job title and pay band or spine point
• the pay date and the tax period, such as “Month 7” or “Week 30”
• your tax code, for example 1257L, S1257L or 1257L M1
• your National Insurance number and NI category letter, usually A
• your employer’s PAYE reference, which HMRC uses to identify the employer.

Check the tax code first. A code ending in W1, M1 or X means an emergency basis and a possible overpayment; see emergency tax codes. A leading S or C means you are being taxed as a Scottish or Welsh resident. Tax codes explained covers the rest.

NHS staff with more than one post (a substantive role and bank work, say) can have a separate assignment number and payslip for each.

Payments: what you earned

This section lists each item of pay separately. Basic pay is your monthly salary (annual salary divided by 12) or your hours times the hourly rate. Other common lines in the public sector include:

• unsocial hours enhancements for nights, weekends and bank holidays, often paid a month in arrears
• overtime and extra hours, also usually in arrears
• high cost area supplement or London weighting
• allowances such as TLR payments for teachers, on-call or standby payments
• arrears, when a pay award is backdated or a correction is made
• statutory payments such as Statutory Sick Pay or Statutory Maternity Pay, alongside or instead of contractual sick or maternity pay.

The total is your gross pay for the period. For how NHS enhancements are calculated, see NHS unsocial hours enhancements.

Deductions: what was taken off

Deductions come in two kinds. Statutory deductions are required by law: income tax, National Insurance and student loan repayments. Voluntary deductions are ones you have agreed to: pension contributions, union subscriptions, salary sacrifice schemes, payroll giving, car parking, staff lottery and so on. An employer can take a deduction only if the law requires it, your contract allows it or you agreed to it in writing in advance.

Order matters for tax. Pension contributions to the NHS, teachers’, local government and Civil Service schemes normally come off before income tax, so your payslip shows a “taxable pay” figure lower than your gross pay. National Insurance and student loan deductions are worked out on gross pay, so the pension does not reduce them. Salary sacrifice reduces your gross pay itself, and so it lowers all three.

A worked example

Say you are a full-time NHS band 5 nurse in England on £32,073 a year, paid monthly, on tax code 1257L, NI letter A, in the NHS Pension Scheme and with a Plan 2 student loan. A plain month with no enhancements would look roughly like this:

Line	Amount
Basic pay (£32,073 ÷ 12)	£2,672.75
NHS pension at 8.3%	£221.84
Taxable pay	£2,450.91
Income tax (20% above about £1,048 tax-free)	£280.58
National Insurance (8% above £1,048)	£129.98
Student loan Plan 2 (9% above £2,448.75)	£20.16
Net pay	£2,020.19

Your actual figures will differ by pennies because payroll uses HMRC’s exact tables, and by more in months with enhancements, overtime or arrears. The 8.3% pension rate applies because £32,073 falls in the £28,855 to £35,155 tier of the 2026/27 NHS scheme. To run your own numbers, use the take-home pay calculator.

Year-to-date totals

Most payslips have a section showing totals since 6 April: gross pay, taxable pay, tax paid, NI paid, pension contributions and sometimes student loan repayments. Payroll uses these for the cumulative tax calculation, and they end up on your P60 at the end of the year.

They are also the quickest way to spot problems. Tax to date that looks high against taxable pay to date can mean the wrong code. A mid-year starter whose year-to-date figure leaves out their previous job probably had a P45 that was not processed. P45, P60 and P11D explained covers those forms.

Employer contributions

Some payslips also show what your employer pays on top of your salary: employer pension contributions and employer National Insurance. These do not come out of your pay. In the NHS in England the employer pension contribution is 23.7% of pensionable pay, partly paid by the employer and partly paid centrally. Teachers’ Pension Scheme employers in England and Wales pay 28.68% until 31 March 2027. Keep these lines in mind when you compare a public sector job with a private sector offer that looks better on salary alone.

When something is wrong

Compare each payslip with your contract and with the previous month. Common problems are missing enhancements, a wrong spine point after an increment date, a pay award not yet applied, an emergency tax code and a student loan on the wrong plan.

Raise pay errors with your payroll or HR team first, in writing, with the payslip in question. Tax code problems go to HMRC, since payroll cannot change a code. If money has been wrongly deducted and nobody puts it right, ACAS can explain your options, and union members can get help from their union rep. Your right to a payslip covers what employers must show.