Finance Globe

U.S. financial and economic topics from several finance writers.
2 minutes reading time (327 words)

Small Business Payroll: Answer These Questions Early On

payroll-sheet

As a small business owner, you’ll have many questions to answer early on in regards to payroll. If you address these right away, you’re in position to implement a system that works for both you and your employees. However, if you put this off, you could find yourself making mistakes that cause additional stress and headaches.

Here are the most important payroll questions to answer as you get your small business up and running:

•    Will you hire employees? Depending on the structure of your company (such as a single member LLC), if you don’t have any employees you may not have to run payroll. Of course, this could change at any time, so you need to keep this question on your radar.
•    Will you run payroll on your own or hire a professional provider? Although you have the option to run your own payroll, it’s a time consuming and detail oriented process. By hiring a payroll provider, you can pass this task off to someone else.
•    How often will you run payroll? You have a variety of options, including but not necessarily limited to weekly, bi-weekly, and monthly. Consider the pros and cons of each schedule before making a final decision.
•    Are you familiar with the many payroll tax laws in your state? In addition to what you do on the federal level, become familiar with any state and local laws that will impact the decisions you make.
•    What are most common payroll mistakes, and how can you avoid them? Knowing where other small business owners have made mistakes in the past can help you avoid a similar situation in the future.

While these are not the only small business payroll questions you’ll have, they’re among the most common. As you answer these, several others may move to the forefront. Be sure to deal with any that come your way, all with the idea of setting up a system that puts your mind at ease. 

4 Options for Dealing With Higher Credit Card Inte...
Four Red Flags of Too Much Debt
 

Comments 2

Wanderer on Friday, 08 March 2019 07:03

The scary part of payroll is when you see that the Federal, Medicare, State and local related payroll taxes have to be paid on a timeline (to avoid penalties). Add to that employer paid benefits for insurances and the share can be quite large. A shock to say the least since you have the costs even if the accounts receivables have not come in yet. Small business payroll expenses can be overwhelming so be sure to plan and allow for the requirements of having employees.

The scary part of payroll is when you see that the Federal, Medicare, State and local related payroll taxes have to be paid on a timeline (to avoid penalties). Add to that employer paid benefits for insurances and the share can be quite large. A shock to say the least since you have the costs even if the accounts receivables have not come in yet. Small business payroll expenses can be overwhelming so be sure to plan and allow for the requirements of having employees.
Frank on Monday, 18 March 2019 16:20

I think even if you have 1 employee besides yourself, it is worth it to outsource this process. As wanderer and ChrisB mentioned, it is very complex. You should be focusing on your business.

I think even if you have 1 employee besides yourself, it is worth it to outsource this process. As wanderer and ChrisB mentioned, it is very complex. You should be focusing on your business.
Guest
Friday, 18 October 2019

Captcha Image