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I think I have always used these two words interchangeably without noticing until my professor was saying how some students misspelled the word and he was amazed.

Can someone tell me when I should use paid over payed?

I searched for a similar question and got even more confused with this title: you paid for a persons drink and expect to be payed back.

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There is no *payed. – tchrist Nov 28 '12 at 2:56
so that question posted actually incorrectly used the word "payed"? – Phil Nov 28 '12 at 3:12
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Yes, that’s right. – tchrist Nov 28 '12 at 3:27
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Upward and Davidson 2011 argue that "in medial positions ModE generally prefers AI, EI, OI (paid, vein, join) to AY, etc., though exceptions are found (e.g. oyster)" and "since Middle English treated I and Y as interchangeable, alternation occurs between AI and AY, which left a legacy in Modern English of AY typically used word-finally (or syllable-finally), but often replaced by AI before suffixes; hence the variation between day/daily, gay/gaiety, mayhem/maim, lay/laid, pay/paid." wiley.com/WileyCDA/WileyTitle/productCd-1444342975.html – Alex B. Nov 28 '12 at 4:03
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@Phil: My mistake! Apparently over a year ago I edited that question to correct the misspelling of "paid" in the text, but I didn't notice it was also in the title. As tchrist says, you can safely assume there is no payed for all practical purposes. – FumbleFingers Nov 28 '12 at 4:46

4 Answers

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Paid or payed is the past tense of pay depending on the sense of pay. The first sense is the usual one of giving someone money while the second sense is to seal (the deck or seams of a wooden ship) with pitch or tar to prevent leakage.

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Per the OED, the only two senses that allow payed are: “13. Naut. a. (trans.) To let out (a rope or chain) by slackening it, to allow or cause to run out. (Also in reference to something let out by the rope.) Now always with out or away. Also transf. 14. Naut. a. (trans.) To cause (a ship) to fall to leeward, or fall away from the wind. Now always with off.” Therefore I feel perfectly comfortable saying that “there is no *payed,” since those simply will not arise. – tchrist Nov 28 '12 at 3:03
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@tchrist- Fishermen use it quite frequently. books.google.com/… – Jim Nov 28 '12 at 4:50
A subtle distinction, but there may be rare instances where "payed" could be used in a financial sense, but only where it is specifically intended to be a metaphorical reference to the nautical sense. E.g. "The large award was payed out in small increments over a decade." You're implying what is done with ropes in a nautical sense, but still talking about money. Still, "paid" works just as well here and is far more common. – Darrel Hoffman Nov 28 '12 at 15:10
up vote 16 down vote

You should almost always use paid.

If you’re talking about money, or anything else that’s literally or figuratively acting like a transaction, then it’s paid: “Jane paid me ten dollars”, or “John played a practical joke on me, but I paid him back with a worse one!”

It’s only if you’re sailing, and dealing with ropes, that payed can be the correct form — “The skipper payed out the rope”, and similar.

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If if wasn't for that nautical term, a good spell-checker would help thwart this error. – J.R. Nov 28 '12 at 9:46
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If I am not mistaken, "payed" is a past tense NOUN, and "paid" is an adjective, like a paid account. Just a (very) educated guess. :/

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What is a "past tense noun"? Chambers(chambersharrap.co.uk) and ODO (oxforddictionaries.com/definition/english/pay--2?q=payed) both define payed as a VERB used as a nautical term. – TrevorD May 17 at 12:21
up vote -1 down vote

I'm coming at this from finance, not linguistics.

If you buy (partial) ownership when you invest (so buying stock instead of making a loan), you give over the right to distribute the returns made from your investment to the manager of the investment. They do not have to release those returns back to you in full or on a regular basis.

So, since this is their discretion, I think "dividends are payed out" not "dividends are paid out".

Here's another thought, based on this and other sites. There seem to be three appropriate uses of payed: 1) I payed out rope. 2) I payed out caulk. 3) I payed a visit [got this from another site].

I think the common thread there is that each involves some sort of attachment to something larger: 1) I payed out (some) rope (from a larger spool). 2) I payed out (some) caulk (from a larger tube). 3) I payed (some time to make) a visit (from my larger pool of free time).

If I'm correct, then my above answer that the correct form is "payed out dividends" because dividends come from a larger pool of profits earned from the investment.

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Can you find a reference to substantiate that? See my comment in response to JNET's answer? – TrevorD May 17 at 12:24

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