TMCnet Feature
December 02, 2021

How to Create Pay Stubs for Your Employees

If you’ve been creating your pay stubs using manual methods, like pen and paper spreadsheets or checks, then you’re doing it all wrong. Payroll is made much easier with technology, as the vast majority of your tasks can be automated using pay stub creators or tax compliance tools.

Generating an Employee Pay Stub

Most states require employers to give their employees a payslip or pay stub when they’re paid. Employers can enclose the pay stub in the employee’s paycheck or send it electronically to their email after they’re paid through direct deposit, e-wallet, or e-transfer.

There are many ways you can create a check stub online using various tools, such as FormPros pay stub template. Regardless of what method you use, you’ll need to include the following:

  • The name and address of the company.
  • The name and address of the employee.
  • The pay period in which the employee was paid.
  • The bank information and check number.
  • The employees agreed-upon pay rate and hours.
  • The employees agreed upon overtime pay rate and hours.
  • The employee's gross and net salary for the pay period.
  • The employee’s mandatory deductions (wage garnishes and taxes).
  • The employee's voluntary deductions (medical insurance and life insurance).
  • The employee’s retirement savings information, if applicable.
  • The date of payment.
  • The employer’s signature.

If you don’t give your employees a copy of their pay stub, they at least need to be given access to that information via a portal. An employee website or payroll department can give both a digital or physical copy of your employee’s pay stubs and an overview of their annual income.

How to Create a Pay Stub Online

Businesses have a few options to generate pay stubs via software or over the Internet. As an employer, you’ll need a consistent way to populate paystubs. The more employees you have, the more your need for sophisticated pay stub software will increase. Here are your options:

1. Free Templates

Templates are an excellent option for super small businesses that manage a couple of employees. You can find several free templates online that can be customized in a word processor. However, there are no guarantees that free templates are legally compliant.

2. Secured Templates

Secured templates are the same as free templates, except they usually cost you a small fee to use once or a subscription fee for multi-use. Another thing that separates free from bought templates is security usually. You’ll still need to make sure what you're buying is compliant.

The best secured template websites will offer a privacy and security guarantee, ensuring no malicious actors are spying on your payment information when using an online portal. Several secured templates have auto-calculators that complete your accounting work for you.

3. Pay Stub Generator

Paystub generators are either free or secured. Just like with free templates, a free pay stub generator may not be legally compliant. Secured pay stub generators typically have the same features as a secured template, like extra security, auto-calculators, and privacy.

The difference between a template and a generator is how you create it. With a generator, you input the information you need, step by step, and the pay stub auto-populates. You don’t have to worry about formatting errors or typography, as everything is done for you.

Just download the document the pay stub generator creates for you. Most pay stub generators will ask for a monthly subscription, which benefits you if you’re a growing startup.

4. Integrated Software

Several finance applications can integrate payroll as part of their feature set. This allows a business to track and manage payroll directly from the software’s interface while also providing an easy way to populate pay stubs, as the information is already right in front of you.

Payroll software will give you the option to set preferences for your pay stubs. If the software is really good, it will populate the pay stub based on your state laws when you select the option to send or print your pay stubs. Otherwise, you’ll have to select what you want on your pay stubs.

Either way, this option can save your company a lot of time and money, but it may not be feasible for everyone. Startups likely won’t need payroll software until they have 10 employees.

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