New Business Owner Finance Tips: How to Do Payroll Like a Pro
As a business owner, you take care of almost everything in your company. While it may be easier to let an expert take care of your accounting, most owners don’t have the luxury or money to pay an expert to run their employee payroll.
You might be one of these owners but aren’t sure if you should try to handle your accounting operations. While doing your accounting may be challenging, you can do your employee payroll yourself. Don’t know where to start?
We’ll tell you how to do payroll the right way. Read on for your ultimate guide to start doing payroll today.
Your Ultimate Guide to How to Do Payroll
While doing your entry tax forms for your products is a must to run your business, you can’t forget about running your employee payroll. Besides doing payroll, you must learn how to do payroll taxes. If you don’t have the right system in place, these accounting tasks can turn into headaches.
Don’t know how to do payroll taxes? Here’s your must-follow guide to start doing payroll today.
1. Choose the Right Payroll Solution for Your Business
While you may run your employee payroll manually, you should consider getting a software solution. The best platform will meet your business needs. If you’re running a wholesaling business, you should use a solution that offers options to calculate and file all required local taxing forms such as the Entry Challah forms in India.
2. Collect the Applicable Employee Onboarding Documentation
Not classifying employees properly is one of the mistakes business owners make when doing payroll. Before running your payroll, you must collect all employee onboarding documentation. It’s important to ask your employees to fill out any government forms that establish their tax liability.
3. Set Up Direct Deposit for Your Employees and Run Your Payroll
If you want to handle less paperwork, you should consider setting up a direct deposit for all your employees. Most platforms provide options to print checks as well. The biggest advantage of using payroll software is that it will calculate all your employees’ pay, payroll taxes, and your own tax liability.
4. Calculate and Schedule Your Payroll Tax Payments
When you run your payroll, your accounting software will calculate your payroll tax payments. Keep in mind that you must enter the tax classification for each employee to make sure your system calculates your payroll taxes accurately.
Most governmental agencies will allow you to pay your payroll taxes on a monthly or quarterly basis depending on the amount of paid wages. You should consider scheduling your payroll tax payments ahead of time to avoid any late payment penalties or charges.
5. File W-2s or Annual Salary and Wage Reports Online
At the end of the year, all businesses must file their employees’ salary and wage information with the applicable governmental agencies. You will file W-2s for your employees in the United States.
You should consider using a system to file each W2 online. Most payroll platforms offer this option at an extra cost.
The Bottom Line
Handling your accounting operations may seem too complicated for you. However, you can do it yourself if you use the right tools and design the ideal process for your business. We’re confident that if you use our how to do payroll guide, you’ll take care of your payroll taxes in no time.
Besides learning how to do payroll taxes, you must keep an eye on other tax liabilities such as VAT taxes. Want to learn more? Read our article for the ins and outs about VAT, CST, and service taxes.