One of the essential services that allow a business to function is payroll. Without a functioning and efficient payroll, you will be unable to pay your workers on time, stay on the right side of the IRS, or manage your budgeting for the financial year.
Wages and salaries account for around 70% of expenses for the average American business, a statistic that highlights just how important it is to get it right.
The movement towards payroll efficiency has been growing in recent years, aided by technology and the rise of outsourced payroll services.
A more efficient payroll system will save you time, money, and resources, while also improving relations with your employees. Here is how you can increase payroll efficiency in your small business today.
1- Go Digital
The most effective first step towards efficient payroll services you can make is to go digital.
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If you are still delivering paper stubs and handling all of your payroll activities on paper, you are simply giving an added burden to your business.
Paper documentation can be lost, damaged, and inefficiently stored. A digital system makes everything much cheaper and easier to produce, track, and trace.
2- Keep Your Payroll Efficiency Policy Simple
All to often, a small business will make the mistake of starting off with a simple payroll process before gradually building up an unnecessarily convoluted one that nobody understands.
An efficient payroll application requires consistency. Make sure your payroll policy is short, concise, and is exactly the same for every single person working in your company.
The less complicated your payroll policy is, the more efficient it will be.
3- Outsource to Payroll Professionals
Arguably the single most effective way to improve the efficiency of payroll systems is to outsource your payroll duties to a professional company.
The very best payroll services will happily guide you through the best-outsourced payroll package for your needs and show you how outsourcing will save you time and money.
With an outsourced payroll company, you will no longer have to worry about this important yet time-consuming piece of business admin. This will allow you to focus on the things that matter, such as growing your business.
4- Adopt a Self-Service Model
Trust is one of the most efficient business practices that you could possibly adopt. Rather than tasking accounting or HR with payroll tasks, trust your employees to take care of it.
Set up an online system where employees can enter and edit their personal information as needed. Allow employees to log their own hours. This will save your company resources and improve morale.
5- Set up a Federal Tax Deposit
Finally, it is important to remember to set up a Federal Tax Deposit for your business so that you can divert the appropriate funds to the IRS in an efficient manner.
Setting up a Federal Tax Deposit can be done online and allows you to pay taxes on a regular, monthly basis.
This will save you a lot of time and stress at the end of the tax year and ensure you do not end up with a nasty unexpected bill.
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Now that you know everything there is to know about boosting payroll efficiency, it’s time to learn more.
By following our expertly-curated Tools & Resources, you can find out exactly what steps you can take to make your startup leaner, meaner, and more efficient.