Avoid These 5 Payroll Mistakes

With summer underway and vacations coming up, many of us feel more distracted from work. No matter what season you are in, you always want to make sure you stay on top of your payroll. Don’t let the sunshine distract you. Avoid these five common mistakes when doing your payroll.

1. Classifying employees improperly. Employees must be classified properly to make sure they get the appropriate benefits. Exempt and nonexempt employees are treated differently, as well as independent contractors. Always make sure your classifications are correct.

2. Calculating pay incorrectly. There are many factors that can affect someone’s final pay. Overtime and commissions must be tracked, and Paid-Time-Off (PTO) must be taken into account. Double-check that you have all the pieces in place to correctly determine pay.

3. Losing track of deadlines. Your employees are counting on you for a consistent paycheck. It’s easy to get bogged down and miss a deadline, but your employees will not be happy if their pay is delayed. Try setting up calendar reminders to make sure you complete payroll on schedule.

4. Forgetting tax forms. Things may get crazy at the end of your fiscal year, but you still have to send out tax forms. Your employees and independent contractors all need their appropriate tax forms, and they need them on time. Make sure you stay on top of all of your forms.

5. Keeping incomplete records. Employers are required by the Fair Labor Standards Act (FLSA) to save pay records from the last three years. Keeping track of your pay records can help you if you get audited, but it will also keep your business organized. Don’t neglect to keep good records for your business.

Payroll can be a time-consuming and overwhelming task, but it is crucial for the success of your business. If you need help with your payroll or bookkeeping services, call AMJ at 919-368-1877 today!

SOURCE

https://www.bamboohr.com/blog/payroll-mistakes-how-to-avoid/