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This process starts with determining the frequency of pay periods, knowing how often you’ll need to remit taxes, and setting up direct deposit for employees. For most small businesses, it also means choosing a payroll service to calculate and pay wages and taxes. Besides using this payroll processing checklist template as a great starting point, keep the following tips in mind to ensure your employees receive compensation in a smooth and organized manner. Ensuring timely and accurate compensation is easier when you have a well-structured payroll processing checklist. Once you approve the payroll, you can proceed to issue payments through various methods as per your payroll schedules.
You can do this by direct deposit, paper checks, or electronic pay cards. Another increasingly popular option these days is on-demand pay, also known as earned wage access (EWA). Essentially, this method provides employees with direct access to some or all of their earnings. In other words, instead of waiting for a payroll cycle to end, employees have the option to receive payment as they earn. Most employees live paycheck-to-paycheck, so unexpected disruptions to a payroll schedule can be disastrous.
Apply for federal, state and local employer identification numbers.
Intuit Inc. does not warrant that the material contained herein will continue to be accurate nor that it is completely free of errors when published. For instance, the Age Discrimination in Employment Act (ADEA) requires employers to keep all payroll records for three years. That information must include any employee benefit plans (including retirement or insurance) and any written seniority or merit system. Such documents will provide each employee’s personal information, Social Security number, and tax filing status. If your payroll includes employee health insurance or retirement savings, you’ll need documentation showing the employee has approved additional deductions.
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Most jurisdictions require employers to report these statutory deductions quarterly and annually. Without a clear and organized approach, payroll processing can lead to frustration, decreased employee morale, trust in your company, and even legal consequences. In this guide, we’ll break down the payroll process step-by-step to help you understand it thoroughly. We’ll cover everything from collecting employee information to verifying tax withholdings.
How to streamline payroll with a workflow checklist and template
Whatever payment method you choose, make sure payments are correct and on time to keep your employees happy and help them manage their money easily. Before you cut paper checks or input amounts for direct deposit, make the last pass to search for anomalies and confirm that your records are up to date. Allow only authorized personnel (e.g., managers) access to employee payroll records, regardless of whatever method you use. By choosing a reliable payroll provider like Paystubsnow, you’re investing in a comprehensive payroll solution that simplifies the entire process. The platform is designed to save you time and effort, so you can focus on strategic decision-making.
Verify Employment and Complete Tax Forms
It involves a comprehensive understanding of payroll deductions, employee payroll taxes, and various other financial obligations. Ultimately, Factorial’s payroll software helps you manage your payroll checklist more effectively, ensuring accuracy, compliance, and efficiency in your payroll processes. A payroll schedule, also known as a pay period, is a designated timeframe in which an employer pays their employees for their work. The duration of a pay period can vary depending on the employer and their payroll system, but it typically ranges from weekly to monthly. By establishing a fixed, recurring schedule in this way, employers can ensure that employees receive consistent and predictable paychecks. Bureau of Labor Statistics, biweekly pay is the most common payroll schedule in the United States.
How can you be sure your employees will be paid on time and in full? What about all your payroll tax obligations and the chance of a potential tax audit? In summary, effective payroll management goes beyond just cutting checks.
Statutory payment and filing
- Before processing payroll, a small business must have an employer identification number (EIN).
- Make sure you collect all the payroll information you need from each of your employees.
- In the data collection stage, employers gather information such as employee details, hours worked, and any deductions or withholdings.
- Boost your payroll processing with our four-page PDF and spreadsheet.
- Smaller businesses with a limited employees count may be able to process payroll more quickly than larger organizations with complex pay structures.
- A product feedback form is a good way to gauge how well (or bad) you’re doing as a company.
Commissions, bonuses, and paid leave are also included in payroll expenditures. The majority of employers ensure that employees’ paychecks are deposited into their accounts at midnight on the day before their pay date. It is something that we expect employers to do correctly as one of their contractual obligations. However, payroll is more than issuing paycheck slips every two weeks. It’s a difficult task that can be stressful and overwhelming for those tasked with completing it.
Process employee hours
- Federal laws may set minimum requirements, but state laws can be more stringent, prescribing specific pay period frequencies.
- Make your Cleaning Proposal Form shine with our drag-and-drop Form Builder — you can add your unique services, prices, and company logo in a flash.
- Payroll consists of various steps, which you may miss without a checklist.
- As you browse this detailed payroll checklist, you’ll learn about one-time steps to set up your payroll initially.
- There are so many moving pieces and multiple perspectives to think about.
- With a payroll policy, employee info, and a direct deposit in place, it’s time to track hours.
This guide and the accompanying spreadsheet, created by Erik Eckel for TechRepublic Premium, will help you get things right. Transform your performance reviews with our exclusive phrases for 2025. Under the Immigration and Nationality Act (INA), employers can only hire people who are eligible to legally work (i.e. US citizens and residents, and foreign nationals who are authorized to work). It is your responsibility as an employer to verify the identity and eligibility of everyone you hire with an Employment Eligibility Verification Form (I-9). This form of classification is regulated by the Fair Labor Standards Act (FLSA), so it is vital that you understand the difference and correctly classify your entire workforce.
Track Employee Hours
Fortunately, using a payroll checklist can assist you in completing the job with few to no errors. This instrument will assist you in completing the tedious task of payroll processing while maintaining an acceptable level of employee recognition and satisfaction. Although the above steps aren’t necessarily complicated, they’re undoubtedly time-consuming. However, payroll software and services automate these processes for you.
Any errors in the system can harm the organization’s performance and satisfaction levels. As a result, your payroll staff is under tremendous pressure to produce accurate results at the end of each pay period. A payroll checklist template is a document you can use as a format to create your own payroll checklist.
Now consider the responsibility of managing a sizable portion of those numbers within your workforce. When a business payroll processing checklist understands how to care for its employees and the unique needs of each individual, it thrives. However, anyone who handles payroll is familiar with the difficulties inherent in this meticulous process.
