The payroll process has changed drastically over the years. Whilst manual processing may be an option, there are many cost effective ways to run payrolls electronically through a small computer based system or alternatively, through outsourcing.
Whilst outsourcing can be highly effective, the fees involved in paying for the outsourcing process can sometimes be counter-productive.
To process a payroll some knowledge and experience is required, especially if your employee is in the trade industry and subject to a number of allowances, penalty rates and deductions. Gross pay is calculated from employment information and time sheets. Some deductions or additions may be tax free, in which they will need to be calculated before calculating tax.
If each employee has been correctly set up in your accounting software package, the payroll process should be relatively smooth. Hours are entered, over time and other penalty rates are calculated.
Before processing any payroll, any employee changes must be done. For example address changes and most importantly, especially for younger employees, birthday changes. If a young employee has had a birthday you want your payroll system to recognise and update any award rate changes. The last thing you need is to have to go back a week or several weeks pater and make adjustments and reimburse an employee for incorrect pay rates.
Once all time sheets and hours are entered the report should be checked and reconciled. Accuracy is important. Incorrect input can cost you, the employer, both time and dollars. It is much easier to pay back an employee than it is to have an employee pay you back due to incorrect and inefficient payroll processing.
Payslips will need to be printed and employees paid, generally online at the bank. These days, payslips are delivered by email, which is also a great time saver.
Tradie Bookkeeping Services will streamline your payroll processing. We will ensure that your system and your employees or contractors are set up correctly and paid appropriately. Choose the experts for your bookkeeping and payroll requirements.
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