23:17
Unknown
Are you running a business or planning to start a venture with some employees? No matter whether your business is small or big and your organization possesses one or fifty employees, having an effective and properly maintained payroll system is a very important factor for smooth running of the payment procedures to your employees. Setting up a payroll system not only ensures your employees are paid accurately on time, but also makes you stay on top of your legal and regulatory responsibilities as an employer.
Payroll software is available in order to set up a payroll system. However, an employer can also use a manual, in house computerized or external payroll system. Here are describing some important steps to set up a payroll management system for small business payroll solutions.
Obtain An Employer Identification Number (EIN): EIN is necessary for many procedures dealing with revenue such as filing returns, reporting taxes and other documents to IRS and reporting information about your employees to state agencies. Therefore, once you have registered your business name with Companies Registration Office, you have to get EIN from revenue commissioner before hiring employees.
Make Sure Whether Your Company Has Employees or Independent Contractors: Know the difference between an independent contractor and an employee. The legal terms create a small and unclear line between the two, but it may affect how you withhold income taxes, pay unemployment taxes and withhold and pay social security and Medicare taxes.
Take Care of Employer/Employee Paperwork: Establishing your policies and procedures are a significant step in all HR payroll systems. Draw up a payroll policy and procedure document to cover all your legal obligations. It usually includes several things such as
• Contracts of employment: starting working hours, holiday entitlements, overtime, additional benefits like pension, car parking and VHI etc.,
• Style of payment: weekly, monthly or bi-monthly
• The rules of payment during work absences such as holidays, sick days, maternity/paternity leave
• The rule of overtime for hourly employees
The Documents That Should Be Produced By An Employee When Commencing Employment Are:
• RSI number or PPS number to uniquely identify employees by the Revenue Commissioners and Social welfare
• P45 from the previous employment or filled form 12A (If it is the first job of an employee) as an application for a certificate of Tax Credits and Standard Rate Cut-Off Point
• Banking details for salary purposes
Selecting A Payroll Management System: HR payroll system needs accuracy and an acute attention to detail. Therefore, the employers are advised to do some research to understand their options. They can inquire to fellow business owners which method they use and seek any tips from them for setting up a payroll system. Usually small business payroll solutions include in-house or outsourced options. Several basic desktop software applications and online services are available that can be used by small organizations to manage payment processing, revenue payments etc.
Run The Payroll: If you have collected all the forms and information, you can start running payroll. You can either enter it yourself or submit the information to your accountant depending on which payroll system you choose.
Keep Records On Regular Basis: Employers are asked to keep certain records for specific periods of time by Revenue Commissioners. Submitting PAYE/PRSI/USC deductions made from employees’ wages to the Revenue Commissioners regularly is the obligation of the employer.
Review Your Payroll System: It is the duty of the employer to review the payroll system regularly to ensure it is fit for purpose and meets the needs of the organizations.
It’s quite natural that you may feel setting up a HR payroll system is daunting. But, you can place an effective and accurate payroll system if you consider the above described steps and plan and prepare accordingly.
Payroll software is available in order to set up a payroll system. However, an employer can also use a manual, in house computerized or external payroll system. Here are describing some important steps to set up a payroll management system for small business payroll solutions.
Obtain An Employer Identification Number (EIN): EIN is necessary for many procedures dealing with revenue such as filing returns, reporting taxes and other documents to IRS and reporting information about your employees to state agencies. Therefore, once you have registered your business name with Companies Registration Office, you have to get EIN from revenue commissioner before hiring employees.
Make Sure Whether Your Company Has Employees or Independent Contractors: Know the difference between an independent contractor and an employee. The legal terms create a small and unclear line between the two, but it may affect how you withhold income taxes, pay unemployment taxes and withhold and pay social security and Medicare taxes.
Payroll Management System
Take Care of Employer/Employee Paperwork: Establishing your policies and procedures are a significant step in all HR payroll systems. Draw up a payroll policy and procedure document to cover all your legal obligations. It usually includes several things such as
• Contracts of employment: starting working hours, holiday entitlements, overtime, additional benefits like pension, car parking and VHI etc.,
• Style of payment: weekly, monthly or bi-monthly
• The rules of payment during work absences such as holidays, sick days, maternity/paternity leave
• The rule of overtime for hourly employees
The Documents That Should Be Produced By An Employee When Commencing Employment Are:
• RSI number or PPS number to uniquely identify employees by the Revenue Commissioners and Social welfare
• P45 from the previous employment or filled form 12A (If it is the first job of an employee) as an application for a certificate of Tax Credits and Standard Rate Cut-Off Point
• Banking details for salary purposes
Selecting A Payroll Management System: HR payroll system needs accuracy and an acute attention to detail. Therefore, the employers are advised to do some research to understand their options. They can inquire to fellow business owners which method they use and seek any tips from them for setting up a payroll system. Usually small business payroll solutions include in-house or outsourced options. Several basic desktop software applications and online services are available that can be used by small organizations to manage payment processing, revenue payments etc.
Run The Payroll: If you have collected all the forms and information, you can start running payroll. You can either enter it yourself or submit the information to your accountant depending on which payroll system you choose.
Keep Records On Regular Basis: Employers are asked to keep certain records for specific periods of time by Revenue Commissioners. Submitting PAYE/PRSI/USC deductions made from employees’ wages to the Revenue Commissioners regularly is the obligation of the employer.
Review Your Payroll System: It is the duty of the employer to review the payroll system regularly to ensure it is fit for purpose and meets the needs of the organizations.
It’s quite natural that you may feel setting up a HR payroll system is daunting. But, you can place an effective and accurate payroll system if you consider the above described steps and plan and prepare accordingly.
