A pay stub is a statement that you get from your employer outlining your pay for hours worked and deductions for things like income tax, CPP and EI.
How to Read a Pay Stub
At the top of the pay stub, you’ll usually have your full name, your employee number, and your employer number.
Every pay stub will outline the pay period which the paycheque is for – in many cases, the pay period will be bi-weekly.
Your pay period can vary based on your agreement with your employer and the nature of your job – for example, commission-only sales agents may only receive paycheques when sales close.
The statement of earnings will outline your gross pay for the pay period.
It’ll show what type of earnings you were paid (basic, vacation, statutory holiday…), how many hours you worked, your pay rate, and the gross pay prior to any deductions.
Next, your pay stub will highlight any deductions taken from your paycheque.
These usually include EI (Employment Insurance), CPP/QPP (Canada Pension Plan or Quebec Pension Plan) and income tax deductions, but there can be others.
There could also be a provincial tax deduction.
The current amount indicates the deductions taken for this paycheque, while the ‘year-to-date’ column or YTD shows the total deductions taken so far in that fiscal year, this one included.
The summary at the bottom of the pay stub simply summarizes all the information above, showing your current and year-to-date gross pay, deductions, and net pay (in other words, what you received after deductions).
Don’t Forget!
The difference between a pay stub and a paycheque is that the latter is the physical cheque that pays you for your services rendered, while the pay stub outlines the details of the payment. Nowadays, most people don’t get a physical paycheque, instead opting to receive direct deposit into their bank account.
Pay Stub Abbreviations
Below are some common pay stub abbreviations and what they mean.
YTD: Oftentimes, employers abbreviate ‘Year-to-date’ this way.
Most pay stubs will show your gross earnings, deductions and net earnings from the beginning of the year to date.
EI: Employment Insurance – this deduction is taken to be able to fund the temporary support the government provides when one is unemployed
CPP/QPP: Canada Pension Plan/ Quebec Pension Plan – an amount taken from every paycheque to offer income when an employee retires, becomes disabled or for survivor benefits.
OT: Stands for ‘Overtime’ and will generally be under the earnings section if you worked overtime and are being compensated for it.
Vac: Stands for ‘Vacation’ and will generally be under the earnings section if you are being paid for time off taken as vacation.
BEN/Ben: Stands for ‘Benefits’ and will generally be under the deductions section if benefits are deducted separately.
QIT: Stands for ‘Quebec Income Tax’, taken off each paycheque in Quebec in the deductions section.
(H) / (S): Hourly or salaried, depending on your employment type.
