Key Takeaways

  • Pay stubs are a record of payment for employees, and in most countries they must be issued as a matter of law.
  • Self-employed people do not need pay stubs in the official sense of the term, but it is often helpful for the self-employed to create them themselves. 
  • An online pay stub generator can be a quick and cost-efficient means for self-employed people to record payments they have received.

Globally, the number of self-employed people is growing faster than ever before, and the reasons for this vary. The uptick in demand for more flexible work arrangements, coupled with the rise of platforms like Upwork, Fiverr, and others, means that workers today, especially younger workers, have more flexibility than ever.

In fact, freelancing, however that may look, whether it’s a marketeer who sources their jobs entirely through platforms like Freelancer.com or the corporate worker who drives Uber on the weekend, is expected to continue growing. In fact, projections suggest that freelancers may make up most of the US workforce by 2027.

“The freelancing world has seen significant growth over the last 36 months,” wrote Exploding Topics. “From the global pandemic to the rise of remote work, societal and technological shifts are causing major changes to the freelance space.” Specifically, an estimated 1.57 billion people in the global workforce are freelancers as of February 2024. Worldwide, the freelance platform market is worth around US$3.39 billion.

While being a part of this trend is exciting, the reality is that when you are your own boss, the admin headache is real. Managing taxes, invoicing and tracking expenses can all be overwhelming without the systems of a traditional employer.

This is where platforms like Remote People, and its online pay stub generator, can really come into play by simplifying the process. 

What are pay stubs, again?

Before we dive deep into how to make a pay stub if you’re self-employed, let’s go into what these official documents are.

Pay stubs are documents given by an employer to an employee alongside their paychecks during a particular period of employment. They are also known as “paycheck stub,” “payslip,” “check stub,” or “wage statement.” These official documents outline how much that particular employee earned and what deductions were made during that period.

This document will also include information such as gross pay (the amount someone makes before any deductions), as well as federal, state and local tax deductions, Social Security, Medicare and more. It also includes voluntary deductions, like health insurance premiums. So your pay stub will consist of a breakdown of these deductions, alongside the amount that that employee receives after all the deductions have been made from their gross pay, which is otherwise known as net pay. Pay stubs usually also include year-to-date total amounts, which summarize the employee’s earnings and deductions for a calendar year.

We answer more frequently asked questions about pay stubs here.

If you’re self-employed, though, you’ll need to create one of these legal documents yourself, and there’s no way around it, especially if you want to verify employment for a home loan, rental application, and more. Luckily, though, Remote People offers an easy pay stub generator that is both easy and quick, so you can get one of these official documents created and sent as soon as possible!

How important are pay stubs?

As mentioned above, pay stubs are an official, legal document that is important for employers and employees. However, if you’re self-employed, while pay stubs are as directly applicable to you, it is still important to maintain a record of how much you’re making as well as your expenses.

Here are some reasons why:

1. Tax reasons

When you are your own boss, you’re responsible for paying your own taxes, including income tax. Keeping consistent and detailed records of your actual earnings and expenses will ensure that you represent your earnings accurately and claim the necessary deductions on your tax returns.

2. Loan applications

If you are applying for a loan or a mortgage, you’ll need to demonstrate verified proof of income. Pay stubs, in this instance, alongside other financial documents such as tax returns and bank statements, can act as your proof of income.

3. Financial planning

Pay stubs can be really helpful when it comes to tracking your income and expenses, as these documents help you understand how much you and your business are making, which will help guide other personal and professional decisions.

4. Legal and contractual purposes

You may be required to provide evidence of income at some point for legal or contractual reasons. Having these documents well organized, detailed, and consistent will make it much easier to fulfil these obligations, especially if they abruptly arise.

What information goes on a pay stub?

This is what a real pay stub looks like.

While there are differences in the details provided on a pay stub depending on the employer, there are some key pieces of information that are standard across every pay stub document. These are as follows:

  • Employee information
    This refers to the employee’s name, address and sometimes employee ID or social security number.
  • Employer information
    This includes the business name, address and federal employer identification number (FEIN).
  • Pay period
    This refers to the specific period that that paycheck covers
  • Earnings
    These are the gross wages earned during the pay period before any deductions have been made.
  • Deductions
    Now, this refers to the various deductions, such as taxes (federal, state and local), Social Security, Medicare, health insurance, retirement contributions as well as any other voluntary deductions. This is both voluntary and involuntary deductions.
  • Net pay
    Net pay refers to the amount of pay the employee receives after deductions.
  • Year-to-date (YTD) totals
    Year-to-date, otherwise known as YTD, are the accumulated totals of earnings and deductions from the beginning of the calendar year to the current pay period.

We discuss what information you will typically find on a pay stub and some of the abbreviations you’ll typically see on a pay stub.

How to get a pay stub if you’re self-employed

If you’re self-employed and need a pay stub to verify income and for documentation purposes, there are a few ways to go about it.

1. Create one yourself

You can manually create a pay stub using spreadsheet software, such as Google Sheets. From there, include all the relevant information, such as your earnings, taxes (federal, state, and local), and deductions. However, the issue with creating a pay stub manually this way is that not only is it time-consuming, but there is also a risk of making errors.

2. Hire a professional to help you create a pay stub

If you’re uncomfortable creating your own pay stub, you can always hire a professional, such as an accountant or a bookkeeper, to create it for you. By doing this, you can ensure its accuracy and maintain peace of mind knowing that it complies with any legal standards and requirements. 

3. You can use an online pay stub generator

Remote People offers a straightforward and intuitive paystub generator for creating mandatory paystubs.

Whether you run a small yet mighty startup, a medium-sized enterprise, or a large corporation – our platform offers a quick and easy solution for generating pay stubs. With user-friendly and intuitive yet comprehensive features to make your life as easy as possible, you can create professional pay stubs that comply with industry and regulatory standards for your employees within minutes.

Here are the simple steps required to make a pay stub in no time with Remote People.

Advantages of using a pay stub

As we mentioned above, if you are self-employed, a pay stub may not directly apply to you, but there are definitely advantages to using one so that you have accurate and up to date financial records. This is for tax reasons, loan applications which require proof of income, financial planning as well as for legal reasons. 

FAQ

If you're self-employed and need a pay stub to verify income and for documentation purposes, there are a few ways to go about it. You can create one yourself, hire a professional such as a bookkeeper or an accountant to make one for you, or you can use a pay stub generator such as Remote People. 

We discuss what information to include on a pay stub in more detail. This includes employee and employer information, pay period, earnings, deductions, and more. For a comprehensive list, read the section above.

Yes, you can use online pay stub generators, such as those from Remote People. Our pay stub generator is efficient, reliable and compliant. Just make sure you ensure the accuracy of the information and data you input!

You can maximize the chances of your pay stub being accepted by ensuring that it’s professional and includes all the necessary details (which we’ve broken down and outlined above). Also, accompany your pay stub documentation with other supporting documents such as bank statements or tax returns. You can also ask the requesting party whether there is any specific information they are looking for and tailor the documents to what they need. 

How often you should create a pay stub depends on your needs and the consistency of your income. Some self-employed individuals create monthly pay stubs, while others may create them quarterly or annually.