What Do You Need to Know?
The cost of payroll processing can be significant for some small business owners. On the other hand, not doing it right can be more expensive by leading to costly mistakes or even penalties. It is important to know what you need to do to get your payroll processed quickly and accurately.
Here is what you need to consider
When budgeting for payroll processing, keep in mind ohow your business operates. For example:
- What types of employees will you have?
- How often will they receive their paychecks?
- How many employees do you currently have?
- How many employees do you plan to hire in the next year?
- Do your employees receive overtime pay, bonuses, commissions, etc.?
The cost of payroll processing
As with any business expense, the cost of payroll processing varies depending on several factors. The complexity of your payroll processing, for example, will determine the cost.
The most common type of payroll processing is direct deposit. This involves paying employees electronically by transferring funds into their bank account. Direct deposit can be done weekly or bi-weekly. Costs vary depending on how many employees you have.
How to save money on payroll
Payroll processing is a fundamental and often costly aspect of running your business. Here are some tips on how to save money while still processing payroll accurately:
- Ask for a quote from a payroll company
- Find a trusted and experienced company
- Determine what you need in a payroll company before speaking with them
- Reach out to multiple companies and ask for pricing information
- Keep in mind that free services may not be accurate or reliable
- Talk about tax rates, accuracy, and turnaround time before deciding
What You Need to Know About the Tax Implications
You need to know what you are legally required to withhold from your employees’ paychecks. For example, if you have a full-time employee who is paid $1,000 per week, you are legally required to withhold 25% of the gross pay ($250). If they are paid monthly, that would be 50% ($500).
It is important for you to take into consideration any other taxes that are required by law. You will need to know how much federal tax withholding, state tax withholding, and Social Security and Medicare payroll taxes you need to withhold from your employees’ paychecks.
Sounds like a lot or work, right?
Let Us Do the Work for You
The cost of payroll processing does not have to be costly. If you take the time upfront to set up a solid strategy, you will save money overall.
Contact Simpay today to learn just how easy it is to set up your payroll and get back to doing what you do best – Running your business.