5 Payroll Management Tips Every Business Owner Should Know
You manage many aspects of your business. You manage the marketing, you manage the employees and you manage the finances. One aspect that is often overlooked is payroll management.
What happens if a new hire doesn’t work out? How do you manage pay rates for new team members?
These are just some of the things to consider when thinking about payroll management for your small business.
In this blog post, we will discuss five tips every business owner should know about managing their company’s payroll so they can save time and money.
1. Create a Payroll Calendar
A payroll calendar is an essential tool for managing your company’s financials.
This allows you to manage everything in one central location and saves time when performing monthly tasks like generating reports, paying employees, or filing forms with the government.
You can manage this on your own by creating a spreadsheet that includes all pay dates (weekly, bi-weekly, or semi-monthly), employee names, and rates of pay. It also helps to include any important tax deadlines so you are aware of what needs to be done each month.
If working with third-party service providers seems daunting, there are many great tools out there designed specifically for small businesses looking to manage their finances independently without hiring an accountant or bookkeeper like Avitus Group.
2. Consider Payroll Training for Your Staff
One of the biggest pitfalls for small business owners is dealing with payroll management on their own.
When you manage your company’s finances yourself, it can become easy to overlook things or make mistakes that could have been prevented if you had sought out professional help.
This includes making incorrect calculations and incorrectly filing tax forms which can have serious consequences down the road.
It is important to remember that even though these are tedious tasks, they need to be done correctly so everyone in your company remains compliant with payroll laws.
This also applies when hiring new employees who will handle any part of payroll processing including creating files for each employee, generating paychecks, and ensuring all taxes are paid at year-end.
3. Choose the Right Accounting Software
There are a wide variety of payroll software options available that can help streamline the process and manage all your company’s financials from one central location.
This includes managing everything around payroll, including tasks like generating reports to manage employees’ earnings over time or for new hires who have been on the job less than a year.
4. Keep Track of New Payroll Standards
Every year, the federal government creates new rules and regulations around payroll which can include minimum wage laws or tax changes.
It is important to stay up-to-date on these changes so you are able to manage your business accordingly throughout the entire year.
This means creating a calendar that outlines all upcoming employee pay rates as well as key financial dates like filing taxes at year-end based on current laws.
5. Audit Your Payroll Procedures
We recommend that you audit your company’s payroll process twice a year.
This allows you to manage all aspects of the financials in one place and is also an opportunity for business owners to make any changes or updates if they identify areas where more time can be saved with new hires, etc.
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Proper payroll management helps companies to avoid conflicts and keep their finances in line. For more articles on this subject, check out our blog.