Among many other things, payroll management plays a vital role in running a successful business. If your payroll department doesn’t work property, you will encounter the following problems:
- Delayed salaries, leading to employee dissatisfaction
- Errors in accounting
- Tax-related issues that can result in penalties
- Wastage of human resources
These, and many more issues, crop up due to mistakes in payroll management. They may seem trivial but they can cost a lot. Here, we have discussed a few of them. Continue reading to know more!
Not Using Payroll Software
Many believe that small businesses do not need payroll software as there isn’t much calculation to do. This is where they make a mistake. Even the operations of a small company need a lot of financial management; thus, the use of payroll software programis necessary. For example, there’s employees’ salaries, general accounting, taxes, etc. These things need accurate and precise calculations. Failing to do so results in payroll mistakes, which as we have discussed above, cost a lot.
There are a lot of small company payroll softwareprograms that are created solely for the purpose of meeting the needs of these organizations. However, for bigger and mid-scale companies, appropriate programs are available. These vary with regards to functionality, prices and features. It is recommended to take into account various factors when making your pick as this is one decision that’s going to stick with you for some time. So, choose wisely.
You wouldn’t like it if your employees missed an important deadline, would you? The same goes for authorities. They, too, do not like when companies miss out on paying taxes or filing other reports after the due date has passed. This is why fines and penalties are levied on them.
What we mean to say here is that it’s never good to miss out on deadlines. The better approach is to have an internal deadline, which must be set a few days before the actual deadline. This will provide you with some additional time to comply with requirements and never be late on any deadline.
Not Managing Taxes Properly
Unless you run a business in Dubai, which is a tax-free zone, you will have to pay a part of your revenue as taxes to the government. Every state has its own regulations vis-à-vis taxes, and these regulations are updated from time to time. Therefore, you need to be aware of them and stay updated to manage them efficiently. Failing to do so may result in getting a penalty, which can burn a hole in your pockets.
A piece of advice here is to use payroll software for accountants that provide tax management support as well. For example, Netchex, a popular online payroll software program, can prove to be really valuable in this regard. It not only facilitates payroll but offers managerial support as well.
Failing to Maintain Payroll Records
No, we are not advising you to maintain huge piles of papers with the intent to maintain payroll records. It’s a dated technique that serves no purpose now. The right thing to do here is to invest in a good payroll program that allows you to maintain digital records and create reports on the go. For example, the use of a cloud-based payroll program can prove to be a great way to keep all the data unified. The best part? There’s no risk of data loss as the records are maintained online. The added benefit here is that they can be accessed easily, no matter where you are located.
The only challenging part here relates to finding a reliable online payroll program. Since there’s a wide variety of such programs available, selecting the best out of the lot can prove to be a little tricky or overwhelming. To make things easy for you, we suggest Netchex. It is one of the most popular widely used payroll programs that comes with a range of extensive features. And the cost is affordable as well. You only pay for the features you use.