Guide to understanding payroll

Guide to understanding payroll

Guide to understanding payroll

Despite the importance of payroll in our lives, surely on more than one occasion doubts have assailed you when you have started to analyze it carefully because you were not clear about some of the concepts that appear in it. So that it does not happen to you again, we offer you a  guide to understanding your payroll: what this document consists of, what information it should reflect, and its key points.

What is payroll?

The payroll is a document that the company has to hand over to each worker.  In it, a series of data about the company, the type of work you have done, the period worked, as well as different economic amounts are reflected. It is the receipt of the payment of your salary, but also the proof of what, as a worker, you have paid to Social Security, as well as the withholdings that have been made on account of the Personal Income Tax (IRPF) . In addition, as it is completed and signed by the company, it is a document that has legal value in case there is a problem related to it.

The payroll acts as proof of payments made to Social Security and personal income tax withholdings, but also as a salary receipt, and as such, it must contain information regarding the type of work performed and the amounts received for different concepts. The  company must reference basic data about its activity such  as:

  • The legal name of the company (not the commercial name, but the one that appears in the registry)
  • Registered office
  • Tax identification code (CIF)
  • Social Security contribution code
  • Settlement period (the period for which payroll is paid)
  • Workplace

The basic data of the worker must also  appear :

  • Name
  • National identity document number (DNI)
  • Worker’s Social Security contribution code
  • Professional category or professional group
  • Date of seniority in the company
  • Contract type code

These data refer to the relationship between the employer and the worker. It is considered the basic information that should appear in a nomic although more specifications can be added. Below we will detail the different parts of payroll as well as the data that must appear in each of them.

Parts of a payroll

The basic parts of payroll are :

  • Header
  • Accruals
  • Deductions
  • Liquid to perceive
  • Stamp block and signatures 

In each of the parts, you will find different data that you must know to correctly interpret this document.

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