Keeping up with payroll can be a difficult, stressful and time-consuming. For some business owners taking care of payroll, in-house can quickly become a nightmare. According to the NSBA and a survey they did on small business taxation sixty percent of small businesses handle their payroll internally. How do you handle your payroll for your Upper Valley Business? It is critical to make sure your payroll is organized in a system that will ensure errors and penalties from the State of NH or VT or the IRS at the end of the year. Here are ten key tips for taking the hassle out of payroll:
- Determine if your employees should be paid
hourly or salary.
For most small businesses you hire employees at an hourly rate. Putting employees on a salary is easier because it takes the stress out of determining how much to pay each pay period.
- Accurately
Classify Your Employees
Whether you hire full-time, independent contractors or part-time employees, if the person is working for your company then you should classify them accordingly for your bookkeeping and payroll.
- Payroll
Schedule
Before you start hiring employees, you should determine how often you are going to pay them. Most companies pay on a weekly or bi-weekly basis. These schedules will help you keep your payroll organized and up to date.
- Simplify Your Payroll Process
According to the NSBA, approximately 30% of small business owners spend five hours per month working on payroll. One-Third of small business owners outsource their payroll to an outside company and spend an average of $500 per month on payroll services.
To make your life easier as a business owner hire a local payroll company. One of the misconceptions is by hiring a large payroll company you’ll get the best price, not is not true. Many local payroll companies compete effectively on pricing and often can offer better value and price over the large corporations.
- Track Everything!
Keep track of everything and store all of your documents in one place. Many companies are moving away from paper filing cabinets to scanning and storing all of your paperwork digitally with high-end storage solutions like ShareFile.com. Sharefile is HIPPA compliant and uses top rated encryption to keep your sensitive files secure from hackers.
Some states require you hold onto some records for a particular period of time. It ‘s nice to track w-4 and w-2 forms, benefits information, vacation time and any tax records that you keep on your business or employees.
- Choose Your Software
Most small businesses use Quickbooks as their choice of software for bookkeeping and payroll. Quickbooks has made a significant push to go online, but as professional bookkeepers, we recommend using the desktop version as it is more robust in features for bookkeeping and payroll.
- Keep Your Employees Longer
Do you want to get your employees to stay longer with your company? Why not give them additional benefits as a perk or reward?
Some companies today offer stipends for child care, a new laptop, or additional insurance like Aflac.com. These are a few of the tax-free options you can offer your employees which don’t dramatically affect your taxes at the end of the year and help to keep employees with your company longer.