Did you know that one-third of small businesses fail to pay their bills and make payroll?
Processing payroll is necessary if you want to keep your staff happy and prevent turnover.
If you want to get a better grip t payroll processing, there are a couple of steps you must follow.
Continue reading to discover the best process for managing employee payroll, no matter how large your business is!
Take Care of Legalities
The first step to take when learning how to manage employee payroll is to take care of the paperwork.
Upon hiring an individual, you must have them fill out W-4 forms for taxing and payroll. This should be one of the first things that new hires do so that you can get them in the system for payroll and have all of the information you need.
At this point, you will also want to ensure that you have an employer identification number (EIN). This number will be assigned to you through the IRS and is necessary to process payroll.
Determine Your Payroll Schedule
Depending on the type of business you are running, you will want to create a payroll schedule that works for you and your staff.
Most companies pay their employees biweekly, or every two weeks. You can also consider paying your staff once a week or twice a month. Look at your expenses and consider how much time you can put towards managing payroll each week to help decide.
Payroll automation is becoming more popular and business owners should utilize the help that it offers.
Develop a Clock-in System
Did you know that many people are choosing fingerprint time clock no subscription companies to manage payroll?
Online companies and software can manage when your staff is clocking in and out of work. Having this information in one place to calculate everything can save you time and money. Instead of doing the math, you can simply log in and get the numbers that you need.
Take Out Taxes
Once you have the number of hours that each employee has worked you can take out their taxes.
Multiply the number of hours with each employee’s pay rate. Once you have this number you can determine how much money needs to come out of their net pay for federal and state taxes.
File Your Forms
Even after you have paid all of your staff, there is still work to be done.
The next step of payroll processing is to file all of your tax forms throughout the year. You will also have to submit W-2s to the IRS for tax purposes. You must hold onto all of this information for several years in case an audit comes up or you need to look into someone’s information.
Manage Employee Payroll With Ease
Figuring out how to manage employee payroll can be overwhelming if you don’t have previous experience.
By utilizing this guide, you can manage a payroll schedule and get money to all of your staff. A strong payroll workflow will keep you up to date on paperwork and ensure that you are abiding by federal and state regulations.
Be sure to check out our blog for more articles about payroll management and how to run a business!
