Payroll Management: The Ultimate Guide

Using a payroll service may take HR out of almost everything related to payroll while using software might place HR in charge of all payrolls. While you can handle payroll yourself, we recommend finding an affordable payroll software or service to handle it for you to save time and headaches. From your overall process to every single pay period, it’s important to have documentation for everything.

Automate payroll-related taxes

It’s best to create an onboarding schedule that will help you complete these forms on time so you avoid errors in the future. Your payroll policies should cover key areas such as pay periods, overtime, deductions, and how errors will be handled. These should also specify who is responsible for each step in the payroll process. A big reason payroll staff turnover is painful is that all companies have their own unique payroll processing intricacies; these small details can take significant time for new hires to learn. Offering flexible payment options is another way to streamline your payroll process. Different employees may have different preferences—some might prefer weekly payments, others biweekly or monthly.

Hiring a professional accountant or an outsourced payroll service is the easiest solution, but often the most costly. You will delegate most—if not all—of the payroll responsibilities to an accounting professional. Just be sure that your accountant has all the information they need to complete payroll on schedule. First, you need to set your company up with the IRS and obtain an EIN.

Do data entry double duty

Costs range from $40 per month and up plus additional fees per employee. Many companies will require you to contact what are functional expenses a guide to nonprofit accounting them for a quote, as they will tailor their services for your unique needs. Rather than managing payroll in-house, you can utilize one of the many payroll outsourcing options. Payroll software allows you to still be involved in the process without having to calculate paychecks and taxes on your own. Both federal and state governments have laws about retaining and storing payroll records, in case government agencies need to access that information.

How do I handle payroll for remote employees?

1. From handling sensitive employee information to calculating taxes and depositing money into the bank accounts of your employees, payroll management can be complicated and fraught with liabilities.
2. Review time sheets and compare them to employee schedules, checking for errors.
3. Some states limit when and how you are able to run payroll so make sure you check your obligations before you establish your pay periods.
4. Many payroll issues such as underpaid taxes or employee misclassifications (contractor vs employee) can be corrected by instituting a wholly transparent payroll policy.
5. You’ll want to make sure that the process is being done correctly and that all of your tax filings are being processed and completed correctly.
6. Accordingly, the information provided should not be relied upon as a substitute for independent research.

You may opt to use payroll software or service if you are looking to save time or if you’re concerned about the number of regulations that are involved with the payroll management process. When you have more than a few employees, the payroll process becomes very difficult to manage on your own. We recommend using payroll software if you are processing payroll for anyone other than yourself. Even if you are a small business, payroll can be a complicated process, especially considering the risk of non-compliance claims. For this reason, many companies choose to use HR tech in the form of payroll software to manage the process. The right solution can help you streamline your processes and safeguard your data so that everything runs smoothly at the end of every payment period.

What other areas of your business might benefit from a higher-end payroll software package? Can the package you’re considering handle billing, invoicing, and other financial processes? It’s easy to acquire tunnel vision to fix one problem, but step back for a bit and take in a wider point of view. Big businesses have entire payroll teams or can outsource the whole process — not so with their leaner counterparts.

Monitor your payroll tax deposits to ensure they keep to a regular schedule according to your tax liability. You will also need to withhold any required taxes, benefits, and garnishments from employee paychecks. Once you complete those steps, you must issue timely payments by mail or direct deposit.

For example, IRS regulations require you to keep all payroll tax records for a minimum of four years. Violations can result in costly fines from the Labor Department, IRS, and state agencies. Whether you’re storing your data online, using payroll software, or outsourcing payroll services, you need to think about your data security. Payroll teams work with sensitive employee data, such as banking information and employee records. Therefore, you need to take precautionary measures to keep that information secured. From handling sensitive employee information to calculating taxes and depositing money into the bank accounts of your employees, payroll management can be complicated and fraught with liabilities.