Few things are more exciting than seeing an idea transform into a new business as an entrepreneur. But starting a business from scratch isn’t the most glamorous job. There is a lot of lifting that needs to be done behind the scenes to ensure everything continues operating smoothly. One of the essential aspects to figure out is payroll management.
There are only so many hours in the day for you to get your to-do list completed. Over time, you’ll likely need to hire some additional hands to help run your business. But without a payroll plan in place, you won’t be able to pay your employees, which will leave them heading for the door.
As a new business that is starting out, you need to determine who you plan to manage your payroll to have peace of mind when hiring new employees.
As a small business, there are four ways you can run payroll:
1. Doing payroll yourself
2. Using an online payroll software
3. Outsourcing payroll management
4. Hiring an in-house payroll administrator
To help you make the best decision for your business, AA Tax & Accounting Services, LLC will walk you through the different payroll management options to determine how you should do payroll.
Payroll Factors to Consider
Unfortunately, hiring an employee isn’t as simple as putting out the job listing, interviewing candidates, and having them start. You need a process to ensure they provide all the necessary documentation before they can receive their first paycheck. As you onboard new employees, have them fill out a W-4 form that the IRS requires to ensure the proper taxes are withheld from their pay.
When building your payroll process, you will need to:
- Determine a payment schedule for your employees
- Calculate each employee’s gross and net income
- Factor in Medicare, Social Security, Federal and State taxes
- Pay federal payroll tax and state taxes
- Pay employees via check or direct deposit
Once you have these details settled, you can determine the most efficient way for you to run payroll.
Doing Payroll Yourself
If you are keeping your business small for now, you may be able to get away with doing payroll manually. This is an effective and budget-friendly option for business owners who run a one-person show or plan to keep their employee numbers to a minimum.
However, while this option saves you money, it can eat into the time you have to focus on other business areas. If you don’t enjoy getting into the weeds and managing the books, it may be in your best interest not to take on payroll responsibilities yourself.
Utilizing Payroll Software
Instead of doing your payroll manually, you may opt for payroll software that still allows you to reduce costs but helps streamline the process a bit more. With payroll software, you can digitally send new employees onboarding forms, file your company’s payroll taxes, manage annual tax forms for employees, track employee paid time off and benefits, and more.
Payroll software helps keep you a bit more organized than if you were handling it all manually and is an excellent option as you begin expanding your team.
Hiring an In-House Bookkeeper
Depending on the size of your business, it may be cost-effective to hire an in-house bookkeeper whose job it is to handle all your payroll and onboarding tasks. You can have peace of mind knowing you have an experienced individual with your company’s best interest in mind, ensuring that all employees are paid on time and what they are owed.
Outsourcing Your Payroll
As a business owner, it can be easy to fall into the rhythm of trying to tackle everything yourself. However, it is vital to recognize when it’s time to delegate some of the tasks on your plate.
Why spend hours each week focusing energy on the payroll when your time could spent growing your business and expanding your customer base? Instead of managing your payroll yourself, you can outsource it to a reliable team.
We use the most innovative technology to ensure the accuracy and safety of your payroll checks, reports, and other documents. Our Southern Utah accounting firm is perfect for entrepreneurs, small businesses, medium-sized companies, and corporations.
AA Tax & Accounting Services, LLC keeps track of all of your payroll documentation, keeping your business financials on track, so there’s no need to hire and maintain an in-house, full-time payroll department. Call AA Tax & Accounting Services, LLC, and start outsourcing your payroll processing services today.