If you’re contemplating hiring employees for your small business, eventually you’re going to have to pay your new employees or they just may not stick around. Setting up your payroll, processing the payroll and complying with the myriad of federal and state payroll rules, regulations and reporting requirements can be complicated. The payroll staff at Batley CPA is happy to pass along some of their hard-earned wisdom to make the process go more smoothly.
The first step is to determine if you’d like to outsource your payroll processing or prepare it in-house. Bear in mind that processing payroll is highly sensitive and can be very time consuming. Taxing agency reporting compliance requirements can be confusing and fraught with pitfalls. Fixing errors can be exasperating. Penalties for non-compliance can be burdensome and untimely. Consider whether or not you have the time to commit to this activity or if it is best spent elsewhere. Your customers don’t care how you process payroll, but they do care about the quality and timeliness of your products or services.
If you decide to outsource your payroll processing, choose a reputable payroll service provider. After you get set up, you’ll typically only have to provide your processor with hours to be paid, rate changes, and other employee updates. They should handle the rest including issuing the paychecks or direct deposit, filing the reports, and submitting the payroll taxes, withholding and benefit plan funding. They should also assist with making corrections and responding to tax notices.
If you’re planning on tackling this chore in-house consider using the built-in payroll module of your accounting software. Engage your CPA to assist with the setup. If set up correctly, this should provide you with meaningful labor reports, automate general ledger or job cost postings, and provide accurate compliance information. You do want to get this right from the very start. There may be an additional cost for activating the payroll module of your software.
Mandatory tasks for setting up your small business payroll
Regardless of whether you outsource or process payroll yourself there are some mandatory set up tasks you’ll need to complete before you can process your first payroll. Your CPA should be able to assist with these as well.
- Register your business for payroll with the proper agencies – IRS, state revenue department and state workforce development agency.
- Call your insurance agent. Do not forget to place worker’s compensation insurance.
- Decide on payroll frequency – weekly, bi-weekly, etc.
- Gather the required employee documents – W-4, I-9, state withholding forms, and identification copies.
Call Batley CPA today to determine how we can help with your small business payroll needs.
About Batley CPA
Batley CPA, LLC is a full-service CPA firm providing tax, accounting, payroll and advisory services to businesses and individuals throughout Green Bay and the Fox Cities. Batley CPA regularly provides clients with best practices and strategies to maximize cash flow, profit, reduce taxes, manage costs and risk, and bring meaning to financial and operational data. The company has offices in Appleton, Neenah and Green Bay.