Processing payroll is a complex part of business. You need specialized skills to get the job done right and on time. In addition to paying employees on time, fulfilling tax obligations, and avoiding compliance penalties, payroll helps you attract talent and gives assurance to your customers that the associates are taken care of for continued growth. As a result, your payroll processing needs to be on time and error-free so your employees continue producing. Here are six ways to effectively deal with complex payroll requirements.
Dealing With Complicated Payroll Items?
1.Be a Numbers Expert
Processing payroll requires exceptional math skills. You deal with numerical data and complex calculations on an ongoing basis. For this reason, a significantly advanced aptitude for math is required. Among other responsibilities, you need to make statutory deductions, submit accurate tax reports to the government, and provide employees accurate net pay.
2. Master Payroll Software
Proficiency with the payroll software your company uses is required. Along with Microsoft Office and Excel, your business might use a dedicated software platform. Because these platforms frequently are updated by developers, it’s important you remain on top of your platform’s capabilities, including weaknesses and areas for improvement. You also need to regularly update your software to maintain efficiency and compliance.
3. Withhold, Report, File and Pay Taxes
A substantial part of processing payroll involves withholding, reporting, filing and paying payroll taxes. You must properly report income, amounts withheld, and amounts paid on behalf of your employees and contractors. You need to maintain the required state and federal records. Accurate, timely compliance is necessary to avoid penalties. This includes remembering when reports and taxes are due and how they may be made, which varies among states and the federal government. Keep in mind that different deposit rules apply to income, Social Security and federal unemployment taxes.
4. Excel at Solving Problems
Dealing with complex payroll means having to solve problems. Miscalculations, tax irregularities, and compliance issues frequently come up. You must efficiently and effectively deal with the problems to anticipate and prevent future complications.
5. Maintain Compliance
Adhering to a network of compliance requirements is essential. Since payroll processing is intricately connected to tax and legal regulations, you must understand how to attain and show fulfillment of ongoing compliance requirements. Because these requirements may vary among cities, states and the federal government, you need a deep level of compliance knowledge and ways to remain current on changes.
6. Avoid Penalties
Failure to file reports or pay payroll taxes on time may result in penalties. For instance, failure to file payroll tax returns on time or deposit the taxes you owe can result in criminal and civil penalties. If you pay less than the required amount, you might be assessed a penalty on the underpaid amount. If you classify an employee as an independent contractor, you might face substantial tax liabilities, fees and interest.
Outsource to Madison Resources
Outsource your payroll to Madison Resources. Our experienced professionals understand, stay current with, and maintain complex payroll requirements so you don’t have to. You do not have to spend time focusing on learning non-core functions. Gain peace of mind by working with us today. Contact us to learn more.