Payroll management is among the most important duties for your small business. Not only is it imperative to pay employees correctly and punctually, but mistakes in payroll processing can be costly to your business. You may end up overpaying or underpaying taxes, and you’ll need to invest time into fixing otherwise avoidable errors.
Thankfully, there are some helpful things you can do to make managing your payroll easier and avoid those pitfalls. You can find four of the most effective ones just below.
And remember, if you want to free your time while guaranteeing complete compliance with everything related to payroll, small business services like H2H Enrollments are available to help.
One of the most common reasons for IRS penalties is employee misclassification. The IRS has a handy guide for helping you see if some workers you’ve classified as contractors are in fact employees.
It’s important that you follow this step early, since it influences other crucial procedures that follow in your payroll processing, including filing Social Security and Medicare taxes.
Mistakes happen, especially if many of the processes in your company rely on manual input of data. Go through your data entry frequently to catch errors early and fix them.
This can include things like timesheets, PTO, and deductions. Even innocent mistakes greatly increase the risk of overspending on payroll.
Not too long ago, in 2019, the IRS issued nearly 5 million penalties to small businesses for problems regarding taxes, which you'll very likely misfile if your data misleads you.
Your business shouldn’t be caught in the next wave of penalties, so go through your data from time to time and make sure there are no errors.
This is potentially the most impactful step you can take to manage payroll processing a lot more efficiently within your small business.
Adopting payroll management software with critical features can save you a lot of time while minimizing the risk of errors.
You have to be careful about which platform you pick, though, since there are many online but a lot of them lack crucial functionality.
At a minimum, your payroll software must be able to manage compensations, deductions, and tax filings. Ideally, you’ll want a cloud-based solution so you can access the data anytime, anywhere, and from any device.
A cloud-native option also comes with the added benefit that it automatically backs up your records.
While the H2H Enrollments payroll processing application has all these necessary features, we also made sure to focus on providing a clean, user-friendly interface. Small businesses that adopt our platform always have an easy time learning how to use it.
A digitally-led approach also makes it possible for you to save thousands of dollars each year with paperless payroll. And you’ll be able to empower employees with convenient features, such as self-service access to their pay stubs.
Even after you’ve hit your stride and you have established methods for accurate and efficient payroll processing, you still need to be ready to adapt. Regulations change from time to time, both at state and federal level, and you’ll have to change your processes as soon as they do.
The only reliable way to keep pace with regulatory shifts is to stay abreast with the IRS’ latest communications. The IRS is typically effective at publicizing any changes to the law, but you’ll need to make an active effort so you don’t miss anything.
H2H Enrollment’s payroll solution can make payroll processing inexpensive and easier to manage for your business. With our system, you can rest assured that you’re compliant with regulations and your employees are getting paid accurately and on time. Learn more about other H2H Enrollments’ other solutions that help you meet critical employer duties, then get in touch to set up your initial consultation.
