There’s no need to be embarrassed about not understanding your payslip, it contains lots of information which can be tricky to get your head around but it is important to understand. Your payslip shows your pay, deductions and tax information. All employers are required to give their employees a payslip and it’s a good idea to keep them for as long as possible.

The top left corner of your payslip is where you’ll usually find your employer’s details. Opposite this, in the middle or top right corner, should be your details. This is also where you might find your payroll or employee number, this is what your employer uses to identify you for payroll purposes.

Next, you’ll see lots of different numbers and codes. The payment date is when your pay will normally arrive in your bank account, it can be monthly or weekly and fall on any day of the month.

Your National Insurance (NI) number refers to your unique number. You must have a NI number to work in the UK. It’s used to make sure all your NI contributions are recorded and so you can get any state benefits you’re entitled to, including state pension later in life.

Your payslip might show a tax period, the tax year starts in April and ends in March. The number here corresponds to the period in which you’re being taxed, eg. if you’re paid monthly, 01 will represent the tax period in April, while 12 would mean March.

Next is your tax code. This is decided by HM Revenue and Customs (HMRC) and is used by your employer or pension provider to work out how much Income Tax to take from your pay. Your tax code is made up of several numbers and a letter. The numbers refer to how much tax-free income you get while the letters can mean different things depending on your circumstances. You can find out what they mean on the government website.

Make sure you’re not on an emergency tax code otherwise you’ll be taxed more than needed.