Avoid Common Mistakes in Your Employee Payroll Practices

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You may be a brilliant business owner, but unless you have a background in accounting, chances are you feel overwhelmed and intimidated by the intricacies of employee payroll. The rules and regulations involving employee payroll are detailed and complex, and they change frequently. This makes keeping up with them difficult, which is why is it always a good idea to have a trusted accountant available for advice and to make sure that your payroll process is updated when changes occur.

Avoid Common Mistakes in Your Employee Payroll Practices

Some common mistakes made in employee payroll are easily avoided and making these mistakes can cost your business money while damaging its reputation and attracting the attention of the IRS.

  • Not Paying Employees Correctly: There are many factors to figuring out what to pay employees for and how often to pay them. First, it is essential that all basic information is correct in your payroll system and that the employees’ hours are logged correctly. Other common mistakes include failing to pay time and a half for over time, paying employees late or not at all, or failing to pay employees for required training, meetings or functions.
  • Not Paying Payroll Taxes: Each quarter, businesses are expected to pay their estimated payroll taxes and not doing this on time can generate fines and further headaches.
  • Mixing Up Employees and Contractors: It is important to correctly designate who is an employee of your company and who works for you as an independent contractor.
  • Improper Recordkeeping: The last thing you want to deal with is an IRS audit. It is critical that you keep your business records in order throughout the year.

Keeping control of your employee payroll process is one of the most important things you can do to increase your business’ success.

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