The earnings statement holds a vital role within the corporate landscape, being intimately tied to matters of finance. In this article, we will go over the elements you should include in your paystub, the benefits of creating such an earnings statement in general, and what good it can bring to the employees themselves—all of that with the best templates for you to use absolutely for free. 

Of course, the statement you may need may differ from what we are proposing, as this kind of precise and essential document may be under the scrutiny of law in many countries. For this purpose, we have created a paystub for the US and similar countries in the EU, but you can easily modify our templates to your liking.

With that in mind, let’s review some of the critical elements for creating the best earning statement!

Earning statement, or, as it is commonly referred to, a pay stub, is also known as an income statement, pay advice or salary statement; it’s a financial report on the overall company’s revenue. It should include such elements as net pay, net income, employee’s gross pay, pay period, pay advance, and other industry-specific features. We will go over the most common ones later in this article.

It is one of the most important financial statements in the company, as it is being utilized to assess the entire financial situation of the company. It’s a comprehensive statement of all the gross earnings, detailed information about social security taxes, gross salary of the management, employees detailed information, and more! 

It’s essential for many stakeholders, as with the suitable pay-stub template, you will be able to see all the deductions, statement of earnings, wage slips, and the ability for the company to move forward. So, it’s a necessity. And that’s why you must create an earnings template for your company. Let’s now go over some details concerning the software we will be using for this particular assignment and some pay-stub templates for you to use entirely for free. Let’s dive in!

Before delving into the actual templates, finding the right software that will serve as the foundation for this particular project is essential. Our top recommendation is Microsoft Office, a comprehensive suite of diverse applications tailored for various office-centric tasks. 

Microsoft Word, for example, stands out as one of the best text editing programs in the world. Likewise, Microsoft Office is a powerful spreadsheet software with a reputation for making even the most advanced data manipulations. And finally, we have the PowerPoint, a tool that can help users create captivating and imaginative presentations.

This particular suite of office apps is recognized globally and has countless users worldwide. Its widespread usage ensures that the recipients of this work will be familiar with the data you have provided and will be able to interact with those documents seamlessly worldwide.

And it’s not expensive anymore. You can get Microsoft Office Key for just a few dollars at Royal CD Keys. It comes with an invaluable feature, a lifetime subscription granting unrestricted access for myriad purposes. Whether you need something more professional or personal, this office package will get you far!

And you can even further amplify the potential of this package with the clever use of templates. With that in mind, let’s find the earnings statement template to suit your needs.

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First, as the title suggests, we have a simple pay-stub template. You have your usuals, like the company’s name, recipients, payment date, payment method, and others, with all the taxes taken and other deductions. If you need a template for everyday use, this fully customizable simple spreadsheet will do just fine. You can also change it to pdf format if you enjoy it more.

Many organizations use it in their service to streamline their pay-stub process. In most cases, you can’t go wrong with detailed payslips, but let’s be honest, if you are running a daily or monthly operating business, and you have employees that you know and talk to every day, as a supervisor – you don’t need anything that detailed in the end. A simple breakdown is sometimes all these people need. 

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The following earning statement on our list is an easy way to keep all your information in one place. If you don’t like having your paperwork all over the place, you can use this simple Excel spreadsheet to get your payslip in check. Accounting is a rather complicated process and typically needs assistance from a professional. With this, you can streamline your paystub in just a few easy steps.

This particular template allows you to use it for employees’ needs and, with some adjustments, for the company's well-being. With an editor, you can change things here and there, fill it with additional information, and it may just be the solution you need. Convert it however you like; it will not make a difference as it’s a versatile tool for multiple purposes.

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And finally, we have the most advanced template on our list. Filing this one and putting your signature at the end may take some time, but those hours will help you to complete many different employee-related brackets that will help you in the long run. It’s not for everyday use, that’s for sure, but if you need something all-encompassing – this is the right way to go. You can calculate wages, see all the hours worked, how much money goes for taxes, and how to calculate it – there is plenty of data for employees and employers that you can benefit from including.

And, as an employer, this kind of organization pay stub with detailed information can help you to present yourself as a reasonable and professional entity.

Let’s go over earning statement benefits you can implement in your business. As usual, we need to state that those are just some of the most common benefits we have observed in the market. What you may experience can be much different than what is usually happening because your situation may need additional assistance. Nevertheless, those are pretty standard, so we are positive you will find at least some of those to your liking.

Creating an earning statement is an excellent way of advancing your strategic planning, making more informed decisions based on the insights you have gotten from developing such a document, and overall – developing your company. With that in mind, let’s dive into some details.

Employees Wellbeing

With a well-drafted earning statement for your employees, you can help them better understand their financial situation, how well they are performing in the grand scheme of things and give them some reassurance. They will see what elements are building upon their financial situation, what kind of taxation they are under, and how they can improve their financial situation. 

Financial Performance

Earning statements not only provide you with an overview of the company’s financial performance during a particular time. It also allows you to learn more about the company’s well-being, how to make an informed decision about your future, and whether the company is profitable. This can help you assess what kind of solutions you should introduce in your company to optimize your workflow.

Data-Driven Decision Making

Additionally, you can make informed decisions based on the earning statements with the right approach. You will see many different data points about what kind of profitability you can talk about, how you can grow, visit places that require attention to improve efficiency, and overall – convince your investors to invest in your company!

Time Comparison

Additionally, you can compare different earning statements over a certain period, as it will allow you to track trends in your company. You will see the periods when the profit is improving, when you need to allocate more resources, and how to optimize your efforts. This kind of analysis will help you see the patterns in your work and how you can use those in the strategic decision-making process.

Investment

Moreover, the earning statement can help you evaluate the attractiveness of a particular business to investors. With some positive trends being visible in the projects, you will be able to convince potential investors to consider allocating their resources to your company. With this kind of potential, your revenue will skyrocket, and all the stakeholders will also benefit from it.

Credit Score

Additionally, if not the investors, why not creditors? Financial institutions take these reports extremely seriously, so if you have a good track record and potential for growth, they will likely help you in your business endeavors as you ask for loans or credit extensions. If you can prove that you have been providing some good results for the bank in the last couple of years, it will surely be visible in your credit reports and lead to banks and lenders seeing you as a reliable partner.

Budgeting Options

Additionally, you can introduce some advanced planning and budgeting techniques with this kind of operational spreadsheet. If you have prepared your earning statement the right way, it will show if your company is profitable; you will be able to see which branches of your business need some budget allocation and where you should invest. Plenty of data pieces will help you optimize your budget for next year and allow you to grow your business steadily.

Performance

As we have mentioned, this kind of spreadsheet will also allow you to produce a performance review to help you improve your company’s efficiency. It will show you where you need to add some resources, which personnel are not giving their 110%, and where you should invest your interest. There are plenty of metrics to keep track of, so having a well-drafted spreadsheet is a great start.

Communication

Additionally, you can use this kind of earnings statement when communicating with your stakeholders. It’s not a secret that this kind of document can have a lot of weight when talking about salaries, fees, taxes, and whatnot. Be sure to have transparency in your reporting, as it will show you as a credible individual with some backing to their assessments. People will feel more stable at your company and potentially more eager to work in a stable environment.

Regulatory Compliance

And finally, we have regulatory compliance. Depending on the country, you may even be obliged to produce such a document for the government. Additionally, it serves as a foolproof argument that you did your due diligence regarding your employees and other stakeholders. With that document, you can deny potential wrongdoing liability, as you have a track record of compliance with the tax code and other regulations.

So, now that we know the benefits of creating an earning statement, let’s go over some key elements to include in this document. Some parts are necessary, but some may be optional in your particular situation. Depending on where you operate as a company, you may need to add some elements. With that all in mind, let’s review some crucial points to add to your earning statement.

Employee Information

The first thing to include in such a statement is employee information. Full name, ID, number, or however you refer to in the company. Additionally, you need to add the pay period for this particular employee’s statement.

Employer Information

That would be you or the company. Remember to add your name and any relevant contact information. 

Earnings Breakdown

It is usually broken down into four categories:

• Gross earnings – it’s the total amount of an employee’s wages, without any deductions. This will be your highest number from which you will be deducting all the other elements. It includes bonuses, commissions, and all the other earnings the employee has earned in the stated period.

• Regular pay – this is the base salary of an employee without any bonuses or commissions.

• Overtime pay – here, you need to add all the overtime hours the employee has worked through.

• Bonuses and commissions – and finally, we have the bonuses and commissions that need to be paid and added to the gross earnings. Benefits paid also should be included here.

Deductions

Next on our list are deductions that you need to make from the paycheck in order to see the net pay of the employee.

• Federal Income Tax – this is mostly for the US situation, but you can treat it as your government’s income tax.

• State Income Tax – also – it’s only in the US, so if you live there, be sure to include not only your federal taxation but also everything you need to pay to the state.

• Medicare Tax – strictly US element, how much you pay for Medicare. In most European countries, for example, it would be a health tax of some kind.

• Other deductions – anything that you need to deduct additionally from the employee’s pay. It can be anything from a retirement plan loan repayments, etc.

Net Pay

Net pay is the amount of what we call take-home pay. It’s how much money the employee receives after all the deductions to the gross earnings.

Earning statement is one of the most important pieces of documentation in the company. It concerns money, so you need to create it as precisely as it is humanly possible. Be sure not to overlook the most important elements, like taxation, deductions, additional earnings, and maybe some country-specific rules to keep in mind. There are plenty of those, so keep that in mind when drafting your very own statement.

Thanks for stopping by! If you liked this article, be sure to check out others on our site. We have a larger library of articles on various topics, from gaming, to office-related stuff and even software. We are positive that you will find something to your liking. If you have any questions – let us know! We will be more than happy to help you out or address any of your concerns. That’s it for today; stay safe, and we will see you in the next one!