You're is a contraction of the words "you" and "are", commonly used in conversations because humans are lazy. It is commonly mistaken with the word "your", as in "belonging to you".

  • "You're kidding" = "You are kidding", although the way that one emphasizes the words can connotate different meanings. It means "you are joking, right?"

That other pesky version, "your", means that the object belongs to you:

  • "Your tea, Madame." The tea for the lady has arrived and it belongs to her. 

These two words get confused all the time, to the point where there are memes out on the Internet. If you're one of the folks who mix them up, just substitute "you are" in the sentence and see if it makes sense:

  • "You're kidding" versus "You are kidding". Yup, makes sense, so use the "You're".
  • "Your tea, Madame" versus "You are tea, Madame". Unless you're writing a novel like Salvador Dali painted, nope, it makes no sense. When that happens always use the one without the apostrophe.

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