---
title: How To Create Paygrades
description: "Paygrade\nCompensation"
---
[Skip to content](https://support.paidhr.com/how-to-create-paygrades#main-content)
English
Show submenu for translations
- Home
- Products
- Pricing
- Blog
- Company
Open main navigation
Close main navigation
- Home
- Products
- Pricing
- Blog
- Company
- English
Show submenu for translations
- Contact us
Contact us
How can we help you?
- There are no suggestions because the search field is empty.
1. [PaidHR Help Centre](https://support.paidhr.com/)
2. [Payroll Management](https://support.paidhr.com/payroll-management)
# How To Create Paygrades
To ensure accurate and efficient payroll processing, follow these steps to set up pay grades on PaidHR
What is a **Paygrade**?
A Paygrade is a specific compensation level used to group employees with the same earnings. It simplifies managing salaries by creating standardized pay levels. For example, if a Paygrade has a net breakdown of 100,000 naira, all employee(s) assigned to this Paygrade will earn that amount.
This system helps streamline payroll management and ensures consistency in compensation across similar roles or experience levels.
Follow these steps to set up a new **Paygrade**:
- Head to the **Menu** on the left side of the screen and scroll down to find **Compensation**.
- Scroll to **Payroll** and click the downward arrow.
- Select **Configuration**.
- Click **Paygrades** at the top of your screen.
- Choose **Create new Paygrade**.
[](https://downloads.intercomcdn.com/i/o/1089255567/3040c5b658bf5b485dc90913/p1.gif?expires=1768197600&signature=da5bd369b5c7122b7b868676fdc50330a51657b824200bee5ce0722c9eedc233&req=dSAvH8t7mIRZXvMW3nq%2BgZTpIf4qNlbsR71Nw3kWr%2F%2B0C40X2VAWwAneDtav%0A4iL9Ej3DDYFMA0lrPQB3igwOBNo%3D%0A)
**Enter the following details to create a Paygrade:**
- **Select Payband**: choose the appropriate payband from the list if it applies to this paygrade. If no payband fits or you're not using paybands, simply leave this field blank.
- **Paygrade name**: assign a name to your paygrade. Don't worry if you're unsure - Pade can generate a default name (e.g., Paygrade 16) which you can edit later.
- **Alias**: an optional, employee-friendly name that will appear on their profiles. Leave this blank if it doesn't apply.
- **Currency**: select the currency used for salaries in this paygrade.
- **Annual pay**:
- Select **Gross** if this amount includes taxes and statutory deductions.
- Select **Net** if this paygrade will have zero deductions.
- **Taxable status**: choose whether to apply standard tax calculations or input your tax calculation method, such as a percentage of gross earnings or a specific tax amount.
**[Add Allowance](https://app-eu1.hubspot.com/knowledge-article/26055346/editor/437009321180/content?redirectUrl=/knowledge/26055346/339893973181/articles/state/all)**
- Click the search bar to select allowances linked to the paygrade.
- Customize each allowance and establish calculations (percentage or specific amount).
- Choose the pay schedule for allowance distribution
**[Add Tax Reliefs](https://app-eu1.hubspot.com/knowledge-article/26055346/editor/341910859990/content?redirectUrl=%2Fknowledge%2F26055346%2F339893973181%2Farticles%2Fstate%2Fall)**
- Click the search bar to select the tax relief to be attached to this paygrade.
- Customize each tax relief.
[**Add Statutory Benefits**](https://app-eu1.hubspot.com/knowledge-article/26055346/editor/341508011203/content?redirectUrl=/knowledge/26055346/339893973181/articles/state/all)
- Select the statutory benefits linked to the paygrade.
- Customize each statutory benefit, including employee deduction and employer contribution.
- Specify if the deduction applies to the entire gross or specific allowance.
[](https://downloads.intercomcdn.com/i/o/1089258443/e9c78a65505fc691a734fe4d/Untitled+Project.gif?expires=1768197600&signature=0c418e3306ae28d213ddc3199c4be18dda2af3e77b346599e28474f47bbf2e55&req=dSAvH8t7lYVbWvMW3nq%2BgUZS40btFXSughNjq4h%2FUu49wQ1fhEQuePdFVgi9%0A%2FAnJc41tyJHTFqHpS7xbDO%2BsKOk%3D%0A)
- Click **Next** to save your new paygrade.
- [Getting started](https://support.paidhr.com/getting-started)
- [Admins: Start Here](https://support.paidhr.com/admins-start-here)
- [Employees: Start Here](https://support.paidhr.com/employees-start-here)
- [Payroll](https://support.paidhr.com/payroll)
- [Payroll Management](https://support.paidhr.com/payroll-management#main-content)
- [Payroll Changes](https://support.paidhr.com/payroll-management#payroll-changes)
- [Allowances](https://support.paidhr.com/payroll-management#allowances)
- [Statutory Remittance](https://support.paidhr.com/payroll-management#statutory-remittance)
- [Amend Payroll](https://support.paidhr.com/payroll-management#amend-payroll)
- [Cross-Border Payments](https://support.paidhr.com/cross-border-payments)
- [Earned Wage Access (EWA)](https://support.paidhr.com/earned-wage-access-ewa)
- [Loan Marketplace](https://support.paidhr.com/loan-marketplace)
- [Settings](https://support.paidhr.com/settings#main-content)
- [Confirmation](https://support.paidhr.com/settings#confirmation)
- [People](https://support.paidhr.com/people#main-content)
- [Onboarding](https://support.paidhr.com/people#onboarding)
- [Leave](https://support.paidhr.com/people#leave)
- [Exit](https://support.paidhr.com/people#exit)
- [Cantractor](https://support.paidhr.com/people#cantractor)
- [HRIS](https://support.paidhr.com/people#hris)
- [Request](https://support.paidhr.com/request#main-content)
- [Leave](https://support.paidhr.com/request#leave)
- [Exit](https://support.paidhr.com/request#exit)
- [Loan](https://support.paidhr.com/request#loan)
- [Performance Management](https://support.paidhr.com/performance-management)
- [Reports](https://support.paidhr.com/reports)
- [Benefits](https://support.paidhr.com/benefits)
- [Documents](https://support.paidhr.com/documents)
- [Assets](https://support.paidhr.com/assets)
- [Wallet](https://support.paidhr.com/wallet)
- [Time Tracking](https://support.paidhr.com/time-tracking)
- [Payslip](https://support.paidhr.com/payslip)
- [PaidHiring](https://support.paidhr.com/paidhiring)
- [Employee Wallet](https://support.paidhr.com/employee-wallet)
- [Disciplinary](https://support.paidhr.com/disciplinary)
- [Tasks](https://support.paidhr.com/tasks)
- [Loan](https://support.paidhr.com/loan)
- [Survey](https://support.paidhr.com/survey)
- [Salary Advance](https://support.paidhr.com/salary-advance)
- Home
- Products
- Pricing
- Blog
- Company
[](http://paidhr.com)
**PaidHR Help Center**
[mailto:support@paidhr.com](mailto:support@paidhr.com)
Copyright © 2026, PaidHR