How to Do Payroll for Your First Few Employees
Hiring your first few employees is a milestone worth celebrating. It means your business is successful and growing.
It also comes with new responsibilities. You may need to formalize communication policies or invest in a larger workspace.
You also have to pay your new employees, and you need to do it the right way. If you’re wondering how to do payroll, this guide is here to help.
Get an EIN
The first thing you need to do is get an employer identification number or EIN. This number is issued by the IRS.
It allows you to collect and remit payroll taxes to the IRS. This is key. You’re responsible for withholding tax and Social Security deductions for your employees.
Improper payroll remittances cost small businesses an average of $845 in penalties. You can avoid these fines by staying on top of payroll.
How to Do Payroll the Easy Way
Payroll processing looks straightforward, but it’s often more complex than people expect. After all, that’s why you’re asking about how to do your own payroll.
The easiest way to do payroll is to use a paystub maker. This online solution lets you plug in your information. It then generates paystubs for your employees.
Since the generator is powered by up-to-date algorithms, you can be sure your calculations are accurate.
These solutions are often affordable as well. You may not even need a subscription. You may want to consider one if you’re going to do payroll on a regular basis.
Use Payroll Software
Another option you have is to invest in payroll software.
Payroll software may integrate with other tools you use, such as employee scheduling apps. If you plan to offer benefits, you may also be able to find software that works with your benefits solution.
Payroll software may be provided as a download, or it may be offered as a service. If you buy software as a service, you’ll have access to up-to-date software on an ongoing basis.
The right integrations and frequent updates can make payroll calculations easier.
Work with a Payroll Provider
After reading about how to do payroll yourself, you might think about getting some help. Working with an experienced payroll provider or bookkeeper can help you avoid common mistakes.
It can also save you time. Instead of getting bogged down with the ins and outs of how to pay employees, you can turn to more important tasks.
Stay Up to Date
No matter which solution you choose, you should stay up to date with payroll best practices. This is especially important if you plan to do payroll yourself.
Be sure to check for updates to regulations about minimum wage and overtime. You’ll also want to be sure you’re using the latest tax tables to determine deductions.
Proper Payroll to Power Growth
Learning how to do payroll the right way will help you as your business continues growing and you hire more people.
If you’re looking for more business ideas and opportunities, you’re in the right place. Check out our listings and discover more ways to keep your business growing.