Small business owners are often required to juggle a variety of responsibilities. Without the manpower of dedicated departments, the more procedural components of a business may take a backseat to core products and services.
Unfortunately, overlooking best practices can lead to cumbersome processes that drain valuable time. Optimizing key, repetitive tasks is one of the best changes any small business can make, and payroll should be at the top of the list for any business hiring employees.
For business owners with an eye on future growth, becoming familiar with these tried and true practices is a great place to start.
Keeping Track of Essential Dates
The fiscal year is filled with deadlines and submission dates. Determining and keeping track of these dates is step one for improving payroll management. An effective management plan minimizes unwanted surprises and helps small business owners maintain payments and documentation across practical timelines.
Working without a plan is working against the calendar, and it frequently leads to larger hassles down the line. Late fees, penalties, and interest payments can constrict upstart businesses. They are best avoided with intentional scheduling. Ultimately, the goal is to stay prepared.
Not every job is one-size-fits-all. Small business owners may build teams resourcefully through combinations of independent contractors, full and part-time employees, and even interns.
Filing taxes correctly hinges on classifying and paying employees correctly. Documentation should reflect the distinctions between the types of employees working under the same payroll system.
At a minimum, late or incomplete paychecks disrupt the perception of a small business. On the other hand, small businesses that consistently operate within routine pay cycles instill confidence.
For small businesses to remain functional and competitive, it is essential that employees are able to plan their finances around the delivery and value of their wages. Small business payroll communications plan can help avoid errors and misunderstandings. Net pay should be examined and explained through earnings and deductions as part of the onboarding process for any new employees.
Deliver Digitally with Direct Deposit
Increasingly, companies at every size are searching for economical methods to limit unnecessary paper trails. In the eyes of many employees, the consistency and simplicity of direct deposit have become benchmarks of healthy, steady businesses.
And at the other end, small business owners benefit tremendously from the simplified collection of payroll data, the reliable documentation for end-of-year filing, and the time-saving automation.
As technology continues to accelerate, small business owners should consider swapping overstuffed filing cabinets for fully integrated electronic payroll management systems.
Record and Reflect
Regular audits of any payroll system will accommodate changes to the business and cut down on potential mistakes. Anything requiring consistent attention saps the time and energy of administrators and business owners. Taking time out to research and implement best practices in the short term will pay dividends over the long run.
Smarter payroll starts with time-conscious structuring and clear communication, and the best systems are backed by regularly scheduled reviews.