Payroll processing is a lot.
It encompasses the entire ongoing process of calculating hours, paying employees accurately, managing withholding taxes, handling highly sensitive information, and depositing money into people’s bank accounts – every single pay period, in addition to whenever reporting and other requirements occur.
And if you miss even a single beat, your company could be at risk of exorbitant penalties, lower employee performance or retention, and damage to your reputation.
How to Improve Your Payroll Processing Efforts
Provide Payroll Training
It’s important that everyone involved in payroll processing, including HR staff, are trained properly so processes and procedures are standardized. Consistency is key. Also, include payroll in onboarding training for new hires so they know what to expect and where to turn with questions.
From your overall process to information about every single pay period, maintain thorough, detailed documentation. This can prove invaluable, especially if you’re audited or inadvertently miss a tax filing.
Keep All Data Secure
Make sure all employee data is completely secure so it cannot be accessed by others, inside or outside your company. Data breaches have become rampant as confidential information is accessed, stolen, or misused.
Use Time Tracking for Hourly Workers
If you pay employees hourly, you’ll likely want to use an automated time tracking system versus manual timecards. This can speed up processing time significantly, as well as help prevent time theft.
Stay Updated on Tax Procedures
This is no small challenge, as they change constantly, but it’s imperative to stay current with all local, regional, state, and federal tax procedures that apply to your payroll. Among the reasons for change may be business relocation, employe relocation, hiring of remote staff members, or legislative moves. Regardless, it’s your responsibility to gather the right information and compute payroll and taxes accurately.
Automate Your Process
Manual payroll processing is easily susceptible to potentially costly errors. For instance, as per the IRS Failure to Pay Penalty, you’re liable for 0.5% of unpaid taxes for as long as a tax remains unpaid. And that’s just one example. Automating your payroll process is an easy way to keep up with important, yet often very time-consuming, tasks.
Avoid Borrowing from Payroll Tax Funds.
Even if your business is temporarily cash-strapped, avoid borrowing money from your payroll tax fund at all costs. If you take this chance, you could fall short of the funds needed when tax payments come due. It’s a good idea to open a separate bank account for taxes only.
Call on KeyHR for All Your Payroll Processing Questions!
The right staffing and support can answer all your payroll-related concerns. For many businesses, the best solution is outsourcing to a qualified third-party provider. KeyHR can help you make the right decision and match when it comes to payroll and other HR needs. In doing so, we’ll save you 20% to 40% in expenses to keep your company and your bottom line strong and healthy. Contact us today to learn more.
- Posted by admin
- On August 2, 2023
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