The Pad Size is the actual size of a pad, which is what the pins of an SMD component rest on to be soldered.
The area where artwork designs fail most to allow enough processing tolerance to meet the minimum annular ring is “pad size” calculation. The following is the minimum pad size calculation formula from MIL-STD-2118:
Min Pad Size = A + 2B + 2C(when required) + D
A = Max diameter of the drilled hole for internal land(s) and finished hole for external land(s).
B = Min annular ring
C = Max allowance for etchback (when required)
D = Standard fabrication allowance. This was determined by statistical survey, which considers tooling and process variations required to fabricate the PCB boards.