KEY TERMS

Gross pay

Money due to an employee before deductions for income tax and NIC, etc.

Net pay

Money payable to an employee after deductions for income tax, NIC, etc.

Non-statutory deductions

Deductions from employees' earnings authorised by the employee, rather than required by law, such as contributions to savings schemes and trade union subscriptions.

Payroll

List of employees and the wages or salaries due to each individual.

Payslip

Document given to each employee giving details of pay and deductions from pay.

State benefit contributions

Amount paid by employees (and possibly the employer) to the state for purposes of social security.

Statutory deductions

Deductions made from employees' earnings required by law, such as deductions for income tax.