As your small business grows one employee at a time, it’s easy to just carry on with your old-school spreadsheet payroll systems.
Avoiding simple payroll adjustments because it means more staff training, switching software, or initial extra cost is going to waste your time and money in the long term.
In fact, 82 million Americans have experienced a problem with their paycheck at some point. Many of these errors occur from basic human mistakes or outdated payroll systems.
Even the smallest of errors can have a huge impact on your employees and your business! Keep reading to find out how you can simplify your payroll and prevent costly mistakes.
How Payroll Mistakes Could Cost You Big Time
Payroll errors don’t just cost you financially. The time it takes to correct mistakes means your finance staff won’t be focused on their daily core tasks. This has a rolling impact on your business, risking further mistakes caused by overstretched staff.
Your business reputation could be at stake, too. Hiring new employees becomes difficult if your company has a reputation for not paying staff correctly or on time.
You could also come under the scrutiny of state or federal tax organizations and face huge fines for simple errors.
The good news is that these things are easy to avoid if you follow just a few simple steps.
5 Vital Rules to Simple Payroll Processing
If you’ve been put off updating your payroll systems because you think it’s going to cost you a lot or be a complex undertaking, think again. These simple steps will help you get ahead of your payroll and reduce the risk of errors.
1. Standardize Employee On-Boarding Paperwork
Give every new employee the same paperwork when they start. Make it clear that they cannot receive any payments until the papers have been fully completed and returned.
This helps you keep track of employee information as part of your financial record-keeping. It’ll also ensure you’re including and processing the same information for every member of staff on your payroll.
2. Use a Paystub Generator for Easy Calculations
You don’t need to pay a lot for payroll software. However, do consider using a paystub generator like PayStubCreator, because it’ll radically reduce the amount of manual work required at each pay schedule.
The generator works out individual salaries, deductions, and taxes for you. This makes it easy to see exactly what you’ll need to pay each employee and also produces a professional-looking paystub every month, too.
3. Keep Accurate Records
The other advantage of using payroll software or paystub generator apps is that they’ll create a paper trail for your business and any auditors.
If there is an error in payments, to an employee or for taxes and deductions, it’s easy to look back and find out where things went wrong.
4. Always File Taxes on Time
Never be late with your taxes! File your taxes quarterly and annually, at both state and federal levels, well ahead of time.
Using payroll software will help you identify exactly how much you need to withhold from each employee’s wages every month. This means you’ll never be short when it comes to tax payments.
5. Prepare for Business Growth
Finally, make sure you’re ready for your business to grow. You don’t need to have a massive payroll application as a small business but aiming too small will double your work in the near future.
Aim for a mid-term vision when you implement your new payroll systems. This allows for staff training and business growth, without the need for investment in costly enterprise software.
More Small Business IT Tips
Simple payroll software is all you need to save time and money for your small business.
Software takes the manual work out of complex calculations and ensures your tax filing is always accurate. You’ll reduce paycheck errors and reduce the administrative burden of payroll.
There are many more things you can do to work more efficiently, improve your profit margins, and grow rapidly. Make sure you check out our other blog posts for hacks and tips to supercharge your small business!