The term ‘payroll’ is not as short and simple as it sounds. For every organization, among the other business related functionality, calculating payroll of an employee is one of the most important operational functions internally. If an enterprise owner is asked about his firm’s payroll costs, their answer will probably take into account the sum of all their employees’ earnings plus any extra costs which might be paid to them in the form of perquisites etc. A proper payroll needs to ensure about all the employees who are on the payroll and their payment being done each month. Incentive schemes and bonuses also form a major part of the business payroll.
Payroll involves accomplishment of many tasks to ensure precise and timely paychecks and payroll tax and record-keeping compliance. These duties cannot be done in haste, and they should be performed with great attention and painstaking detail. Otherwise, erroneous paychecks and improper payroll tax and record-keeping procedures can bring back an adverse effect on the firm. The faulty paychecks can cause employees to become upset; the latter two situations can cause penalties to the firm and losses to the owner. Consequently, when doing payroll, apply a step-by-step process.
Don’t keep the processing of payroll to be done at the end of the month. It should be done ahead of time. Plan a payroll-processing schedule that allows you ample time to process the payroll and to correct identified errors before employees receive their paychecks.
Make changes to the employees’ payroll record, if applicable. This includes: address changes; payroll deduction changes, such as income tax form changes; and voluntary deduction changes, such as retirement and health benefits. Furthermore, enter new joiner’s information as and when they join.
The time sheet of each employee has to be uploaded duly into the system, such as regular, overtime and vacation hours. If you use a biometric system, you can integrate the time into the payroll software. Just ensure the time is transported correctly and make the necessary edits.
Other adjustments, such as additional pay or wage deduction due underpayment or overpayment from a prior pay period should all be done before processing the final payroll. Prorate the salaried employees’ pay if he/she resigns, and enter stop dates in the payroll software to stop future payments. Furthermore, prorate the salaried new joiners’ pay if they are hired after the current pay period begins.
Crosscheck reports that allow you to verify the payroll before you print and generate pay slip of each employee. Make adjustments, if required.
Generate the direct deposit file of the pay register of the month and forward to the bank. Contact the bank and ensure it is appropriately received, and verify the amount received.
Print payroll registers showing employees’ gross-to-net wages for the current payroll.
Print and distribute reports needed by related departments, such as human resources and finance, for benefits administration and reconciliation purposes. If your firm’s payroll is outsourced, forward the necessary tax records for each pay period to the respective individual.
Although, Payroll Processing is a time taking and erroneous process, but with the help of PayWheel, a comprehensive Payroll Management Solution, all these 8 steps can be reduced in just 3-4 clicks. It generates highly accurate results quickly, thus increasing payroll processing productivity for all Payroll / Finance personnel in an organization. It manages employees’ payroll, generates Statutory Reports such as PF, ESI, PT, Income Tax Reports such as Form 16 and 24Q, and it is also comprised of a Leave Management workflow, which can be integrated with an existing Biometric system. PayWheel makes payroll processing a hassle free experience for users who can configure and implement it without any prior training. PayWheel is fully web based payroll software that seamlessly integrates all the payroll related activities within an organization. It scales down the workload of administrators, promotes confidentiality, produces error-free information & reports, and accelerates the speed in accessing and executing payroll related information.