Name: Finora
Rating: 4.8 (120 reviews)
Author: Finora

A payslip is more than just a piece of paper—it's a legal document that provides transparency about an employee's compensation. Nigerian employers are required to provide payslips that clearly show how an employee's pay is calculated. This guide explains what must be included and how to stay compliant.

Why Payslips Matter

Legal Requirement

Under Nigerian labour law and regulations:

Employers must provide itemized pay statements
Employees have the right to understand their pay
Payslips serve as official records

Practical Purposes

Purpose	Benefit
Transparency	Employee understands compensation
Disputes	Evidence in case of disagreement
Tax compliance	Shows PAYE deducted
Loan applications	Proof of income for employees
Audit trail	Documentation for your records

Required Payslip Elements

Employee Information

Every payslip must identify:

Element	Example
Employee name	John Okonkwo
Employee ID/number	EMP-001
Department/position	Finance / Senior Accountant
Pay period	January 2025
Payment date	January 28, 2025

Employer Information

Element	Example
Company name	ABC Company Limited
Company address	15 Marina Road, Lagos
Company registration	RC 123456

Earnings Section

List all components of gross pay:

Component	Amount
Basic salary	₦400,000
Housing allowance	₦200,000
Transport allowance	₦100,000
Utility allowance	₦50,000
Other allowances	₦50,000
Overtime (if any)	₦0
Bonus (if any)	₦0
Total earnings	₦800,000

Deductions Section

List all amounts deducted:

Deduction	Amount
PAYE tax	₦116,427
Pension (employee 8%)	₦56,000
NHF (2.5%)	₦10,000
NHIS (employee 5%)	₦20,000
Loan repayment	₦25,000
Other deductions	₦0
Total deductions	₦227,427

Net Pay

Item	Amount
Total earnings	₦800,000
Total deductions	(₦227,427)
Net pay	₦572,573

Year-to-Date (Optional but Recommended)

Item	YTD Amount
Total earnings	₦800,000
PAYE tax	₦116,427
Pension	₦56,000

Sample Payslip Format

═══════════════════════════════════════════════════════════════ ABC COMPANY LIMITED 15 Marina Road, Lagos PAYSLIP ═══════════════════════════════════════════════════════════════ Employee: John Okonkwo Employee No: EMP-001 Position: Senior Accountant Department: Finance Pay Period: January 2025 Payment Date: 28-Jan-2025 ─────────────────────────────────────────────────────────────── EARNINGS ─────────────────────────────────────────────────────────────── Basic Salary ₦400,000.00 Housing Allowance ₦200,000.00 Transport Allowance ₦100,000.00 Utility Allowance ₦50,000.00 Other Allowances ₦50,000.00 ─────────────────────────────────────────────────────────────── TOTAL EARNINGS ₦800,000.00 ─────────────────────────────────────────────────────────────── DEDUCTIONS ─────────────────────────────────────────────────────────────── PAYE Tax ₦116,427.00 Pension (Employee 8%) ₦56,000.00 National Housing Fund (2.5%) ₦10,000.00 NHIS (Employee 5%) ₦20,000.00 Loan Repayment ₦25,000.00 ─────────────────────────────────────────────────────────────── TOTAL DEDUCTIONS ₦227,427.00 ─────────────────────────────────────────────────────────────── NET PAY ₦572,573.00 ═══════════════════════════════════════════════════════════════ Payment Method: Bank Transfer Bank: First Bank | Account: **1234 EMPLOYER CONTRIBUTIONS Pension (Employer 10%) ₦70,000.00 NHIS (Employer 10%) ₦40,000.00

Year-to-Date: Gross ₦800,000 | Tax ₦116,427 | Net ₦572,573 ═══════════════════════════════════════════════════════════════

Additional Information (Recommended)

Employer Contributions

Show what employer contributes on employee's behalf:

Contribution	Amount
Pension (employer 10%)	₦70,000
NHIS (employer 10%)	₦40,000
Group life insurance	₦5,000

These don't affect net pay but show total compensation.

Leave Balances

Leave Type	Balance
Annual leave	15 days
Sick leave	10 days

Payment Details

Detail	Value
Bank name	First Bank
Account number	**1234
Payment method	Bank transfer

Delivery Requirements

How to Provide Payslips

Method	Acceptable?
Physical paper payslip	Yes
Email (PDF attachment)	Yes
Employee portal access	Yes
Verbal only	No
Not providing at all	No

Timing

Payslips should be provided:

At the time of payment or shortly before
Not significantly after payment
Allow employees to verify before payment if possible

Retention

Party	Retention Period
Employer	At least 6 years
Employee	Personal record

Common Compliance Issues

Issue 1: Missing Deduction Details

Problem: Payslip shows total deductions but not breakdown

Requirement: Each deduction must be itemized

Fix: List PAYE, pension, NHF, etc. separately

Issue 2: Incorrect Calculations

Problem: Numbers don't add up

Impact: Employee disputes, compliance questions

Fix: Use payroll software that ensures accuracy

Issue 3: Not Providing Payslips

Problem: Employees don't receive documentation

Impact: Legal risk, employee dissatisfaction

Fix: Implement systematic payslip distribution

Issue 4: Late Delivery

Problem: Payslips provided weeks after payment

Impact: Employees can't verify pay

Fix: Automate payslip generation and delivery

Employee Rights

Access to Information

Employees have the right to:

Receive payslip with each payment
Understand all deductions
Question discrepancies
Request clarification from employer

Disputes Process

If employee questions payslip:

Review with HR/payroll
Explain calculations
Correct errors promptly
Issue revised payslip if needed

How Finora Generates Payslips

Automatic Generation

After payroll processing:

Payslips generated automatically
All components calculated
Professional format applied

Customizable Templates

Feature	Options
Company branding	Logo, colors
Layout	Multiple templates
Content	Show/hide sections
Language	English

Distribution Options

Method	Feature
Email	Automatic to employee email
PDF download	Bulk or individual
Employee portal	Self-service access

Record Keeping

All payslips stored securely
Searchable by employee, period
Accessible for audits
Retained per legal requirements

Digital vs Paper Payslips

Digital Advantages

Advantage	Description
Efficiency	Instant generation and delivery
Cost	No printing/distribution costs
Storage	Easy archival and retrieval
Access	Employees access anytime
Environment	Paperless option

Legal Validity

Digital payslips are legally valid if:

Contain all required information
Are accessible to employees
Can be printed if needed
Are securely stored

Frequently Asked Questions

Must I provide a payslip if the employee doesn't ask?

Yes. Payslips should be provided automatically with each payment, not just on request.

Can I combine multiple pay periods on one payslip?

Best practice is one payslip per pay period. If you pay monthly, one payslip per month.

What if an employee loses their payslip?

Provide a duplicate. Maintain records so you can reissue when needed.

Do payslips need to be signed?

Not typically required. Electronic payslips don't have signatures but are still valid.

Should payslips show bank account numbers?

Partial masking (e.g., **1234) is recommended for security while still identifying the account.

Conclusion

Payslips are a fundamental employer obligation:

Provide with every payment
Include all earnings and deductions
Show clear calculations
Deliver in accessible format
Retain records properly

Compliant payslips protect both you and your employees by creating transparent documentation of compensation.

Finora generates professional, compliant payslips automatically—ensuring every employee receives proper documentation with every payment.

Need professional payslips?

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