Simplify Your Payroll Processing With These Tips

In the U.S, there are around 77 million new hires every year, which highlights the importance of a robust payroll processing system.  

Simplifying your payroll system is key for tracking your finances and keeping your employees happy. But without a process in place, crunching the numbers can feel overwhelming, especially if you’re a newbie. Perhaps you’re currently struggling with your payroll processing system and you’re trying to streamline it.  

Sounds like you? Don’t worry; we’ve got your back. Here are our tips to simplify the payroll processing process.  

Create a Payroll Policy 

In the first stage of the payroll process, figure out how often you’ll pay employees (e.g. weekly or monthly), how employees will receive the funds and deductions. You must also factor in gross wages and tax so you pay the right amount. And don’t forget bonuses, sick leave, and tips if you’re in the hospitality industry.   

Collect Relevant Employee Data 

Before you start paying employees, you need their personal information. This will include their bank account details, Social Security numbers, and tax reporting status. Note, if your payroll includes health insurance or retirement, confirm that each employee is eligible for this. 

Keep Up With the Minimum Wage 

Familiarize yourself with state laws regarding minimum wage. This will fluctuate depending on how large your company is. If you don’t abide by this, you’re at risk of a hefty fine. 

Produce and Distribute Payslips

Once you’ve compiled the necessary data, produce and distribute employee payslips. Make sure you include the gross pay, deductions, and net pay. And, to avoid confusion, include the hours worked for that pay period.   

Note, you calculate net pay by subtracting tax from the gross payment. If you don’t have software, use a spreadsheet as it’s easier to digest and reduces the risk of errors. 

Complete Payments On Time 

As an employer, it’s your responsibility to complete payments on time. If you’re paying the team manually, consider the holidays and have the required materials ready. Or, if that’s overwhelming, invest in payroll automation software offered by a reputable company like hrwisellc.com for peace of mind.

Payroll software is useful as it generates reports quickly and reduces the risk of making costly mistakes. Also, it means you needn’t hire an HR team or an accountant to manage your employees’ payslips.  

Produce Annual Reports 

It’s wise to complete annual reports so you’re prepared for the current and next tax year. This document should include your teams’ pay and deductions. If you’re feeling overwhelmed, consider hiring a freelancing accountant when it’s time to file your taxes. 

Simplify Your Payroll Processing Today 

Hopefully, after reading this article, you can simplify your payroll processing needs. 

There are multiple ways you can streamline the payroll process such as following a payroll policy and collecting relevant employee data. It’s also crucial that you pay employees on time and produce annual reports for your records. Good luck! 

Found this article helpful? Great! Then check out the rest of our blog for more tips and tricks.