Reading a Pay Stub

Pay Period

  This is the date range you are being paid for

  It is usually biweekly (every two weeks)

  It could also be semi-monthly – that is, always on the 15th and 30th of the month.

  Sometimes the pay period is monthly

Pay Date

  This is the date that you can cash the cheque

  The cheque is no longer valid (stale-dated) six months from that date

SIN

  This is your Social Insurance Number.

  You must keep it very private, to protect yourself from identity theft.

  DO NOT carry your SIN card in your wallet! If your pay stub includes your SIN file it safely, and then shred it before throwing it away.

Pay Rate

  This is the amount you are paid per hour.

  Some people make a salary that does not depend on their hours worked.

  On their pay stubs, they see only the amount of pay in the pay period, but not an hourly rate of pay.

Net Pay

 This is the Gross Pay minus the deductions – the amount you take home.

# of Hours

 This is the number of hours in this pay period.

 Check to make sure it is correct. If you have worked more hours, speak with your employer.

 If your employer uses a time clock, always remember to punch in and out so your hours are recorded.

Gross Pay

 This is the amount you have earned before any deductions. Year to Date

 Many pay stubs will keep a running total of your earnings and deductions for the year.

Deductions:

Federal Income Tax

  Your employer will calculate the amount of federal income tax to deduct from your earnings.

  The tax system in Canada is ‘progressive’. This means that the more income you make, the higher percentage of your income will go toward taxes.

Provincial Income Tax

  Your employer will also calculate the amount of provincial income tax to deduct from your earnings.

  This amount will be lower than the federal tax and is different in each province.

Canada Pension Plan (CPP)

 For those 18 years old and over.

 Employers will deduct 4.95% from your gross earnings over $3500 until you reach the maximum contribution.

 The 2011 maximum was $2,217.60. It goes up each year.

Employment Insurance (EI)

 Your employer must provide you with a pay stub to show your earnings and deductions.Check to make sure that the information is correct!

November 4, 2014
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