You get your payslip – and your eyes go straight to the bottom righthand corner. How much did you get! And fair enough too – but just what do all those other parts mean?
On the left is your National Insurance number. This is always two letters, six numbers and then a letter.
On the right is your tax code – written here as 11000, but it can also be written as 1100L. In fact, it will be written like that on correspondence from HMRC. For the 2017/18 tax year, the code will have been updated to 11500 or 1150L. This code represents the current personal allowance which the majority of you will have. It means that the first £11,500 of income will be free from tax.
This part is fairly self-explanatory. It's the current period that you're receiving your salary. The period number runs from 01 to 12 in line with the months of the tax year which runs from 6 April to 5 April.
In this case, the period is 01 as it's the first payment of the new tax year. You will receive your pay on the 20th of the given month (April in this case), with the payment being in respect to the month ending 30 April.
Taxable Pay is your gross earnings, less the pension, less any other deductions made before tax.
The employee name should hopefully be you!
Supn Pay is your pensionable pay for the month. This is an important figure as it's what the various benefits of the pension is based on. It's made up of two parts – basic pay and the London Weighting allowance.
The conditioned hours will be 40:00 unless you are working part time.
This section of the payslip deals with your earnings.
There are a few things that can be listed here, but the ones shown in this example are the most common. London Weighting and the London Allowance are set amounts and are the same for all federated ranks regardless of service.
Any overtime will also be listed here together with the rate at which it's paid (in this case time and a third). Basic pay is as it sounds – your yearly salary divided by 12 to give a monthly amount. The total at the bottom is your gross income for that month.
This part of the payslip deals with the deductions that are made from your gross pay, leaving you with your net pay which is what you are actually paid.
Tax paid – Self explanatory. What you pay the tax man. For the majority of you, the rate will be 20% of all taxable income over £916.67 (being the tax allowance of £11,000 divided by twelve).
1 EEs NI Contri – For National Insurance contributions which, depending on individual circumstances, can vary, but for the vast majority the charge is 12% of earnings over £672 per month.
2015EEs C13.44% – Your pension contribution. In this example it’s 13.44% of your gross pay. But pension contribution rates vary depending on pensionable pay:
- Tier 1 – up to £27k a year: 12.44%
- Tier 2 – between £27k and £60k: 13.44%
- Tier 3 – over £60k a year: 13.78%
TAUA – Tax adjustment uniform allowance. This is paid to you in April, even though it appears on the Deduction side. It's the allowance for uniform cleaning that you would otherwise have to claim individually from HMRC.
Police Fed – Your Federation subs.
Group Insurance – Life cover and more from the Police Federation. If you have not done so already, we recommend that you check the benefits available. It provides £145k cover, plus a lot of other extras for just £10.01 a month – full details are on the Federation website.
Travel Insurance – Another option through the Federation. Again, contact them if interested.
Reg 28 Insurance – Federation again – protection in case of half pay or no pay due to sickness or injury.
ATOC Rail Conc – Only for officers who joined before 31st December 2013. Pays for your travel on tubes, trains and buses. Make sure if you travel outside London that you are still within the ticket-free travel area. If part of your journey is outside then you must buy a ticket for that part. From 2014 officers receive a TFL concession which gives free travel on tubes and buses only.
Ben Fund (GAYE) – This stands for the Metropolitan Police Benevolent Fund (GAYE means ‘Give As You Earn’) which provides funding for the Rehabilitation Centre at Flint House, Goring, the Metropolitan and City Police Orphans Fund and the Relief Board.
MP Lottery – As the saying goes, you have got to be in it to win it!
MPFS/Metfriendly – Any Metfriendly savings plans or protections policies that are paid for by salary deduction are included here.
And finally we get to the crunch – total payments less deductions gives you what you will get in your pocket that month – your Net Pay!
Now you know your Net Pay, you can get to work on making sure you know where your money goes every month. Our budget planner will help you to breakdown your areas of expenditure and once you have done this, you can start identifying any areas to make savings. This is the first step on the road to financial success for you and your family.