Net pay refers to the amount of money an employee receives after all required and optional deductions have been taken out of their gross wages. Often called “take-home pay,” it’s the actual amount deposited into the employee’s bank account after payroll is processed.
A Closer Look at Net Pay
To estimate net pay, an employee can total all payroll deductions, such as FICA contributions, income taxes, and any other withholdings, and subtract that figure from their gross income. The remaining balance is their net earnings. Payroll solutions like Beyond are designed to handle these calculations accurately, ensuring each employee receives the correct amount.