Payroll is typically one of the top concerns that many small business owners have when running their business. Your employees will expect to be paid on time, and receive the correct salary too. If there are additional payments to include, such as bonuses and leave pay, then this adds to the complexity of your payroll tasks. But get your payroll right and you’ll keep your employees happy and focused on their role in growing your business.
Tasks to carry out before payday
- On or before you reach payday, these are just a few of the payroll tasks you will have to carry out:
- Record your employees’ pay, including their salary and/or wages and any other pay
- Calculate and record the appropriate deductions from their pay
- Produce and distribute payslips for each employee, itemising their deductions.
- Additional employee payments
There are several other employee payments that you may have to report when it comes to dealing with your payroll. These include:
- Holiday pay
- Payments for time spent travelling – payments for subsistence allowance and travel reimbursements.
- Maternity leave payments
- Guaranteed payments for employees for days they don’t work that aren’t paid holidays
- Payment that can be converted into cash – Fringe benefits/perks.
- Cash prizes for competitions.
- These eight tips will help.
Know your big deadlines
Dealing with accounting deadlines and employee returns is much less stressful when you know what you need to do well in advance. Make sure you have a good system in place that alerts you to important dates and if you need to do anything. Working ahead gives you time to sort out any blips or problems. This includes the likes of ensuring payday runs smoothly and on time, and your payroll year-end duties are completed.
Invest in payroll software
Payroll software will automate the whole process for you, taking care of things such as tax calculations, generating payslips for employees, keeping up with legislation, and providing information for end-of-year payroll requirements.
Get good support for your payroll software
If you use a software or online package, and a technical glitch is preventing staff from being paid, you’ll want help at hand to save stress and embarrassment. Always check that online or telephone support is part of the deal and easily available.
Be a stickler for detail
Take time to set up your employee details correctly on your payroll system, such as start dates, up-to-date addresses, dates of birth, and so on. Mistakes will only lead to problems down the line.
Keep up with payroll legislation
Regulation changes may affect how you need to run your payroll, so it pays to keep abreast of major new laws. Benefits and taxes change frequently and while you don’t necessarily need to know all the details, it’s worth staying informed and getting advice when you’re not sure.
Invest in payroll software training
If you use payroll software, taking a short training course could help you save time and be more efficient.
Have a financial backup plan
Keeping on top of payments is crucial in any growing business. Setting up a good credit control system, sending out invoices promptly, and always chasing late payments firmly as soon as they become due will help avoid cash flow disruption. If one of your customers doesn’t pay on time and you can’t pay your staff, your business could be in trouble. Always try to keep some surplus cash for a rainy day.
And if all else fails… try payroll outsourcing
If managing payroll yourself is proving a real headache, consider outsourcing to a payroll company. They’re experts at what they do and can save you the hassle of managing everything yourself and staying on top of regulations and paperwork.
When it comes to managing your small business payroll, there can be a lot to consider and do. But having good systems in place and using payroll software can make life a lot easier. If you need support with your payroll processes, reaching out to a payroll expert, accountant or even your payroll software vendor is a good step to take.