Your business’s payroll processes matter when it comes to organization, and morale. Doing payroll is a part of every company that cannot be overlooked. However, getting the process right can be hectic. There is an enormous scope of responsibility that comes with being in charge of the payroll. Here are tips that can aid you in efficiently managing payroll, while reducing the risk of errors.
Develop a Payroll Calendar
Payroll calendars aid employees acknowledge when they get paid and when timecards are expected. It will also serve as a guideline for your payroll staff. It will help them plan and execute payroll tasks. Certain payroll software automatically develops a payroll calendar for use once you have established your pay schedule.
Get an EIN
Any company with employees or a plan to hire them should have an employer identification number (EIN). With an EIN, the IRS can monitor business income taxes and payroll tax payments. Companies that plan on hiring employees will benefit from getting an EIN sooner instead of later. That way, you can hire employees immediately when you are ready. Companies can get an EIN from the IRS.
Combine With Your Other Systems
Your business processes get easier when you combine your payroll system with other business systems. You can integrate your payroll process with your HR programs, accounting systems, and time-keeping software. For example, if your employees are on an hourly payroll, you can integrate your payroll with your time-keeping software. By doing so, employees can know just how long they have worked and see how much they will be paid on the next payday.
Stay Up-to-Date On Tax Procedures
Employers need to always know their tax obligations and any modifications in state/federal tax requirements. Changes can happen for several reasons, such as employee relocation, business relocation, and more. When changes like this occur, it is your job to update the information required to determine payroll and taxes properly.
Set a Budget
It is imperative to know how much your payroll expenses will have on your business’s finances. After all, companies must have adequate cash on hand for employees to be paid on time and in full. Employers usually do not anticipate just how much of an expense doing the payroll is. To prepare an accurate budget, you have to estimate the overall payroll amounts as a percentage of revenue to ensure the expenses won’t impact your company’s finances negatively.
Determine Whether Employees Should be Salaried or Hourly
As the employer, you have to further classify employees as hourly or salaried. Hourly employees are covered under the Fair Labor Standards Act (FLSA). This means that they must receive overtime pay for working more than 40 hours weekly. However, employees that are paid salaries are not covered by FLSA overtime laws.
Outsource Your Payroll Duties
If you handle payroll yourself, then the chances are that you are stressed with the payroll processes. However, you can consider outsourcing these duties. You can turn to online payroll services like Kurv Business so that you can focus your efforts elsewhere. You could also hire an accountant or use payroll software.
Being able to properly carry out your payroll processes is a representation of your company and shows your ability to keep your employees satisfied. Consider these tips and see how they make payroll processes much easier. If you can adopt some of these tips, you can manage your payroll better, and continue to grow your business.