Building up a small business from scratch is never an easy job. But you know what's harder? Managing and maintaining a company payroll. We understand how difficult it is for you as a small business owner to handle the long, boring, and tiresome process of payroll. But no matter how scary of a task it is, it is an essential part of running your business.
In this article, we are going to break down the top 6 tips you can follow to streamline payroll for your small business.
To simplify payroll, the first thing you have to do is set up a budget. This will be a significant cost to your business, so make sure you consult with your accountant before making any decision. In the initial stages of your business, try to keep the cost down, and as your business grows, hire more people as needed to expand further.
As an employer, you have to fulfill certain obligations towards your employees, as directed by state and federal laws. Under Federal Insurance Contributions Act (FICA) regulations, you have to pay social security and Medicare taxes. Your responsibility also includes withholding income tax from employees and reporting the correct figures to the IRS.
You have to decide on a specific payroll schedule. This determines when your employees will get paid and at what frequency– weekly, bi-weekly, or monthly. If you have full-time employees, going monthly is the ideal option, but for freelancers or independent contractors, you might go with other options. Once you decide on this schedule, you have to stick to it with strict consistency.
Salary status refers to the way of computing salaries for each employee. You can choose between paying on an hourly basis, or on a salary basis. This entirely depends on the needs and requirements of your business. If you're just starting out, hiring hourly contractors would be a good idea. You will save the extra cost of hiring a full-time employee, such as social security, Medicare, etc.
Setting up a full-proof payroll system makes sure your employees and contractors get paid on time, and helps you run your business smoothly. While manually handling payroll sounds like a cost-effective option, it could be extremely time-consuming and tiring. So, your best option is to hire a reliable payroll service provider like Accountants Now, who will take care of every nifty detail on your behalf.
It's crucial to maintain the payroll record of every employee, at least for the last 4 years. Not just the payroll, maintaining a record of other business-related transactions is also necessary. In case the IRS comes for a tax audit, these records will come in handy. If you fail to provide them, your small business will have to bear some serious penalties.
Whether yours is a newly launched small business or you've been in the trade for some time, payroll can be a tough nut to crack. Manual handling will take hours and hours of work, with the risk of faulty calculations that can have dire implications. To avoid the headache and the agony, the best solution is to leave the payroll responsibility to Accountants Now.
Our expert accountants will do the paperwork for you, so you can keep your mind worry-free and focus on scaling your business. Our easy-to-use online payroll solution will make sure your records are error-free, and your employees are paid on time on every payment cycle. Contact us today for an instant quote.
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