Records and data · 5 min read

Payslips and record keeping: what to give, what to keep, for how long

The itemised payslip rules including hours for variable pay, RTI, P45s and P60s, and the retention periods for pay, hours, holiday, accidents and right to work records.

Reviewed September 2026. Guidance, not legal advice: employment law moves, so check the current position before relying on any of it.

Two things go wrong with pay records in small firms. The payslip does not show what the law says it must, so the first tribunal question ("how many hours were you paid for?") has no answer. And records are thrown away after a year because someone said the tax rule was three, when the minimum wage rule is six.

This guide sets out what a payslip must show, what has to go to HMRC and when, what to give leavers, and a retention table for the records an employer of hourly staff has to keep.

The itemised payslip

Every employee and every worker is entitled to a written itemised pay statement at or before the time they are paid (section 8 of the Employment Rights Act 1996; extended to workers from April 2019). It must show:

  • Gross pay.
  • Each variable deduction and its purpose (tax, National Insurance, pension, attachment of earnings, agreed deductions).
  • Fixed deductions individually, or their total with a standing statement of fixed deductions issued annually.
  • Net pay.
  • Where pay varies by time worked, the number of hours paid for, either as a single total or broken down by rate. This applies to hourly staff, and to salaried staff paid for overtime.
  • Where net pay is paid in more than one way, the amount and method of each part.

Hours on the payslip

The hours requirement, in force since April 2019, is the one small employers miss. If any element of pay in the period depends on how long the person worked, the payslip must show the hours that element is paid for. A hourly-paid worker's slip shows the hours. A salaried worker who did ten hours of paid overtime shows the ten hours. It is what makes a payslip checkable against the minimum wage, and it is what a worker takes to a tribunal if you did not.

Payslips can be electronic if the worker can access and print them. Work-Lynx payslips carry the hours from the timesheet.

HMRC: RTI, P45, P60

Under Real Time Information you report pay and deductions to HMRC on or before each payday, through payroll software. Late filing attracts monthly penalties after the first default in a tax year. A new starter needs a starter checklist or P45 to set the tax code; a leaver gets a P45 when they leave; every employee still employed on 5 April gets a P60 by 31 May. Expenses and benefits go on P11D by 6 July unless payrolled.

Retention: how long to keep what

Different rules set different minimums. Keep for the longest that applies, and keep pay and hours together because one proves the other.

  • PAYE records (pay, deductions, RTI submissions): three years after the end of the tax year they relate to (HMRC).
  • Minimum wage records (pay and hours sufficient to show compliance): six years (National Minimum Wage Regulations 2015).
  • Working time records (the 48-hour limit, night work, opt-outs): two years (Working Time Regulations 1998 reg.9).
  • Holiday records: no statutory period, but accrued holiday claims can reach back years; keep with pay records for six years.
  • Right to work check copies: the length of employment plus two years.
  • Accident book and RIDDOR reports: three years from the date of entry.
  • Statutory sick pay, maternity and paternity pay records: three years after the end of the tax year (HMRC).
  • Pension auto-enrolment records (assessments, opt-outs, contributions): six years; opt-out notices four years.
  • Personnel files generally: the length of employment plus six years covers the limitation period for contract claims. Justify anything longer.

Data protection and records

Pay records are personal data, and health and absence records are special category data. Keep them for the periods above and no longer without a reason, restrict access, and be able to produce an individual's records within a month of a subject access request. A retention schedule, written down, is what shows a regulator you thought about it.

Deductions

A deduction from wages is lawful only if it is required by law (tax, NI, court orders), authorised by a term of the contract the worker had in writing before the deduction, or agreed by the worker in writing in advance. A "we always deduct for breakages" custom is none of those. Retail workers have an additional cap on deductions for till shortages of one tenth of gross pay per payday. Unlawful deductions are claimed in the tribunal, going back up to two years.

The checklist

  1. Payslip template shows gross, each deduction, net, and hours where pay varies by time.
  2. RTI filed on or before every payday.
  3. Starter checklist or P45 for every new starter; P45 to every leaver; P60 by 31 May.
  4. Pay and hours records kept together for six years.
  5. Right to work copies kept for two years after leaving.
  6. Written retention schedule, with a destruction routine that follows it.
  7. Deductions only where law, contract or prior written agreement allows.

What the law says

  • Employment Rights Act 1996 s.8 (itemised pay statement), s.9 (standing statement of fixed deductions), s.13 (unlawful deductions), s.18 (retail workers).
  • Employment Rights Act 1996 (Itemised Pay Statement) (Amendment) Order 2018: hours on payslips and the extension to workers from 6 April 2019.
  • Income Tax (PAYE) Regulations 2003: RTI, P45, P60 and record retention.
  • National Minimum Wage Regulations 2015 reg.59: six-year records.
  • Working Time Regulations 1998 reg.9: two-year records.
  • UK GDPR Art.5(1)(e): storage limitation.

Questions people ask

Do I have to give payslips to casual staff?

Yes. The right extends to workers, not only employees, and casuals are workers at least. Their payslips show the hours, because their pay varies by time.

Can I email payslips?

Yes, as long as the worker can access and keep them. Password-protect them or use a portal; a payslip is personal and financial data.

How far back can a worker claim for underpaid holiday or wages?

Unlawful deduction claims can cover a series of deductions going back up to two years from the claim. Minimum wage arrears go back six years. That is why the six-year record is the one to keep.

The admin this guide describes, done for you

Work-Lynx holds the records, calculates the entitlements, drafts the letters and reminds you of the dates: 49 UK policies, GPS clock-in, rotas, leave, timesheets, payslips and Employ AI for the questions in between. £2.50 a month plus £1 per employee, 14 days free, no card.

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