As an entrepreneur or small business owner one of the many new skill sets you will have to develop is managing and processing payroll. Even if the vast majority of the payments you issue will be 1099s, the tips below provided by leading mobile payments company PayAnywhere, will ensure you are taking a proactive approach.
Tip #1 Accurate Employee Classification
An important part of managing payroll is understanding employee classifications. When employees are not classified properly it can have significant ramifications when it comes to their tax status, benefits, and gross pay.
Tip #2 Review Data Entry
Data entry mistakes can cost large companies millions of dollars each year, and small to medium-size businesses hundreds or thousands of dollars each year. This could be something as simple as transposing numbers, or accidentally hitting the wrong key—but can prove to be quite costly.
Tip #3 Know Your Labor Laws
One of the most common mistakes entrepreneurs and small business owners make, is that they assume or are unaware of statewide and nationwide labor laws—and payroll laws. Make sure you have a system in place to ensure you are aware of any statewide, nationwide, or IRS changes that will affect how you manage payroll.
Tip #4 Technology Is Great, But Not Perfect
In order to streamline the process, provide you with checks and balances, and compliance protocols—many small business owners utilize payroll software. While payroll software is fantastic, don’t rely on it with full faith—but instead look at numbers and reports to ensure accuracy and compliance.
Tip #5 Time Is Of The Essence
When managing payroll you not only have to ensure that you process your payroll in a timely manner each pay period, but that you are in full compliance with deadlines for all of your tax documents and forms.
Even if you have delegated payroll to someone else, ensure that there are systems in place for all of the above areas.