In-house payroll for small businesses seems the likely choice for those with just a few employees. However, whether you have 10 employees or 1,000, there still are certain payroll laws and IRS reporting guidelines to which you must adhere, not to mention your own cash flow to manage.
Here are four tips to help you make payroll a smooth operation every month:
Whatever you do, utilize a software program to help you with payroll. Alternatively, simply use an excel spreadsheet that helps you calculate and save payroll data. The old way of doing payroll by hand in a ledger is outdated and invites too many errors.
Many small to medium businesses have great success with payroll software like Intuit Payroll, which integrates easily with Quickbooks, and EZPaycheck from HalfPriceSoft. Software like this gives small business owners complete control over payroll functions and automate all the local, state, and federal taxes.
Use a Separate Payroll Account
Open a separate payroll fund checking account. This will help you streamline your payroll accounting, keep better track of cash flow, and assure that you have enough to cover your payroll each pay period.
Hire a Payroll Specialist
If you have the resources, hire an accounting specialist who can perform the regular payroll functions as part of their job. This might be an HR person or an accounting assistant. Make sure you write the payroll duties in as part of their job requirements in the job description.
Leave it to the Pros
Sometimes payroll is simply too much for a single small business owner to handle. There may be concerns about abiding by regulations or missing certain tax laws, risk of litigation if payroll is inaccurate, or a host of other concerns. In that case, using a payroll service will relieve the burden of payroll and help you be confident that payroll is done right every time. They can help you with withholdings, consistency in cutting checks, and assure that the IRS gets their money – all for a reasonable fee. Check your local area for a reputable payroll service near you.