Payroll: Must known to every businesses!
This is a guest post by Deepanshu RelattaPayroll is the amount which the businesses pay to their employees during each pay period Click To Tweet
Small businesses cannot avoid payroll. If the employees in the organization are vast then you’ll have to do payroll. Now the question arises what is payroll? So the answer is; Payroll is the amount which the businesses pay to their employees during each pay period or payroll may be referred as the process of actually calculating and distributing the wages and taxes.
Parts included in payroll
1. Working hours: If the employees in the organisation is working on hourly basis then it will be important to track their work hours, so that it will ensure you to pay your employees the proper amount.
2. Fringe Benefits: Fringe benefits are the compensation. The benefits like education facilities, health insurance, retirements plans. The benefits provided to the employees are included in payroll.
3. Payroll taxes: Payroll taxes are the taxes which is deducted from the wages and salary of the employees. Payroll taxes include federal income tax, state income tax, local income tax, unemployment tax, medicare tax etc.
4. Gross pay and Net pay: Gross pay is the amount of money the employees receive before any taxes and deductions are taken out. Net pay is the amount of money the employees take home after all deductions have been taken out. Its is kind of take home pay.
How to run payroll?
Here are the following payroll options through which you can do the payroll.
1. Payroll by hand: Payroll by hand means manual work. In payroll by hand you have to learn about how to do payroll and this process is very time consuming. The IRS provides tax table that you can use to calculate federal income tax withholding (found in publication 15)
2. Use of payroll software: Payroll or freeware accounting software provide the facilities through which you can save some of your precious time. The software keep the record of each and every employees. Payroll software can calculate the wages and taxes but this option might be expensive. There are some payroll tax filing services which makes payroll simple and easy.
Payroll is not just about calculating the gross income of the employees, it includes more. New hiring procedure, law ,wages and salaries and especially the taxes are all considered in payroll. One can also use the software for doing the payroll, which saves the time. Also calculate the gross pay and Net pay of the employees probably taking taxes and deductions in it. There are some payroll tax filing services which makes payroll even simple and easy.
Disclaimer: This is a guest post by Deepanshu Relatta from merchant social software. Facts, views and opinions expressed in guest posts are of the writers and it does not reflect the view of this website in any form and we do not take liability for the accuracy of the content.