How to Manage Payroll. The satisfaction of your employees with their work environment is critical to the success of your business. One area of frustration for many employees is a slow or inefficient payroll system. Your business needs to manage payroll functions so any employee questions or concerns can be handled immediately.
Keep Track of Your Company's Payroll
Research your state's payroll tax laws before you proceed with payroll management. In addition to federal withholding for Medicare and Social Security, your state may have additional fees taken out of your payroll for local programs. You can search for your state's tax information at the QuickBooks website (see Resources below).
Set a schedule for state and federal tax payments that exceeds legal requirements. Depending on the size of your payroll, tax payments need to be made bi-weekly or monthly along with your payroll tax information. Failure to meet these deadlines leads to high penalties since payroll taxes provide a large revenue source for government agencies.
Pass out W-4 forms to new employees before you process their payroll information. The federal W-4 form indicates the amount of income that must be withheld by employers for each worker (see Resources below). This form is critical to accurately assessing your company's payroll tax burden.
Open a checking account for your payroll funds that is separate from your general business account. Federal law requires that payroll taxes not be paid from a general checking account. You should also use your payroll tax account for benefits and common expenses, as these need to be reported as part of employee income.
Encourage employees to use direct deposit for their paychecks. This electronic deposit option allows you to manage your payroll efficiently without a mountain of forms and receipts.
Create a uniform payroll delivery system for all employees. You can manage payroll issues more quickly if you know that everyone receives checks by mail, interoffice delivery or electronic deposit.
Audit your company payroll on a monthly basis to ensure accurate accounting. Focus on wages paid to new employees and former workers who received their last check in the previous month.