Net pay is the amount an employee actually takes home after all deductions are removed from their gross pay. It is also called “take-home pay” and reflects the real earnings an employee receives.
Deductions that reduce gross pay to net pay may include:
- Federal, state, and local taxes
- Social Security and Medicare contributions
- Health insurance or retirement plan contributions
- Other withholdings such as wage garnishments
Example: If an employee’s gross pay is $3,000 and total deductions are $600, the net pay is $2,400.
When you generate a pay stub using SecurePayStubs, net pay is automatically calculated, ensuring accurate pay for your employees every time.
Last modified: March 9, 2026
