Getting paid is one of the things that employees look forward to. Whoever is in charge of the payroll must ensure that miscalculations should be kept to a minimum as employees, as well as the government, will seldom tolerate such errors and mistakes.
A lot of things happen when it comes to payroll processing, which is why constant updates are a must to ensure accuracy and proper compliance with certain legislation. Keeping a record or a payroll register template is highly recommended when it comes to payroll to ensure that you have a complete list of employees currently employed for a specific pay period. This will help you monitor the hourly wage or salaries that should be given to each employee.
If you are in need of tips and a quick guide regarding payroll and the processes involved with it, keep reading this article. We have also included a couple of free payroll samples that can help you make your own payroll template.
Basic Payroll Templates
Sample Payroll Timesheet Template
Printable Teacher Payroll Sample
Sample Payroll Record for Farm Labor
Sample Payroll Ffor Voluntary Deduction
HR Management Payroll Sample
Internship Payroll Spreadsheet
Free Payroll Spreadsheet Template
Printable Payroll Spreadsheet
Blank Payroll Spreadsheet Template
School Payroll Spreadsheet
Payroll Tax Spreadsheet Calculator
What Is Payroll?
When you hear the word payroll, you will probably relate it to work-related operations pertaining to calculating the salaries of the employees and the corresponding taxes to be deducted from the salary of each employee.
Payroll refers to the list of the employees in your company alongside the corresponding information that they have, the amount you pay every pay period or even the process of calculating and distributing the salary of each employee.
What Is Included in Payroll?
A payroll spreadsheet is composed of a few sections that would help to determine if the computations are correct and if they are going to the right person. In this section, we will give you a quick breakdown of what is usually included in a payroll.
When a company decides to hire an employee, collecting his/her basic information is one of the first things that is done. This is usually done through the Form W-4. This form will collect the following information:
- employee name;
- Social Security number (SSN); and
- information that will help to determine the tax exemptions that the employee might be entitled to.
The information mentioned above is the basic information that you will need in order to properly process employee payroll.
Want to make sure you have everything you need from a newly hired employee? Check out our new hire checklist samples and templates to help you track the requirements accomplished by the new employee.
Number of Hours Worked
More often than not, companies will usually keep track of the number of hours that an employee has worked for in order to accurately compute for compensation. This is true for employees who are being compensated on an hourly basis.
For these cases, you can opt to take a look at our employee timesheet calculator templates in order to help you with the calculation of your employee’s hourly wages.
Leaves and Absences
All of your employees are entitled to paid leaves whether it be sick leaves, vacation leaves, maternity leaves, paternity leaves, and the like. You have to make sure that you are able to properly track the leaves that each of your employees takes. This goes the same for authorized and unauthorized absences that they have made.
For these cases, you can review the company policies you have regarding leaves and absences.
Salaries, Wages, and Overtime Pay
What is the difference between salary and wage?
Salary refers to the fixed amount that a company pays an employee. This is often a yearly salary that is divided into the number of pay periods that your company has within the year.
Wage, on the other hand, refers to the pay you give your employees based on the number of hours that your employee has worked. A specific rate is set for an hour worked by an employee.
Now that you know the difference between the two, make sure that you correctly compute the salary or wage of your employee.
Overtime refers to the excess hours worked by an employee beyond the required number of hours for a specific period of time. Now, when it comes to giving overtime, make sure that you know the company policies regarding giving it or if your company gives any overtime at all.
If you give your employees benefits, this should also be included in the payroll. This would include the following:
- education assistance,
- retirement plans, and
Deductions in payroll refer to the amount of money that is taken away from the total salary/wage that an employee gets. Deductions include the following:
- Payroll Taxes. Payroll taxes vary for every employee depending on the exemptions and amount of salary/wage that an employee gets. If you need more tips regarding payroll tax, you can take a look at Employer Responsibilities for Payroll Taxes. So what are considered to be payroll taxes?
- Federal Income Tax
- State Income Tax
- Local Income Tax
- Federal Unemployment Tax
- State Unemployment Tax
- Medicare Tax
- Social Security Tax
- Garnishment. Garnishment refers to a court-ordered deduction that is used to pay an overdue debt incurred by an employee. Overdue debt can be in the form of unpaid taxes, loans, and overdue child support. You will be notified via a legal letter if there is a need to deduct a garnishment from an employee’s salary/wage.
Need a guide regarding taxes? Check out Payroll Tax Basics for Small Business to give you a good guide on how you can compute for taxes especially if you are just starting out.
Net and Gross Pay
In the payslip template, you will typically see that net pay and gross pay is reflected. Gross pay refers to the total pay sans the deductions while net pay refers to the employee’s take-home pay after all of the deductions has been made.
Running a Payroll
There are four ways on how you can run and compute payroll: manual payroll computations, outsourcing a payroll accountant, using Excel, and using a payroll software.
- Manual payroll computation. Manually computing for a payroll has its risks such as inaccurate computations and other errors regarding payroll, but it would be good to do so especially if you are just starting out. It is also very time-consuming.
- Outsourcing a payroll accountant. There are definitely benefits of outsourcing payroll. It can help you free up some of your time and make use of it for other areas of your operations. However, it might not be very economical for your company especially if your company is on a tight budget.
- Using Excel. Making use of Excel or other similar applications to compute your employees’ payroll can help to ensure that you are able to accurately compute each of your employees’ pay especially if you are planning on doing it yourself. You can make use of the payroll samples and templates that we have uploaded to this very article. If you want to make your own payroll template, you can check out our article about creating payroll in Excel using simple tips.
- Using a payroll software. There are a ton of payroll software available for download. The convenience of making use of a payroll software is the fact that it can automatically compute the pay of all your employees with just a few inputs and clicks.
There is no right or wrong way of processing payroll. It all depends on what you prefer or what is more convenient to use in your company. Whether you have been doing this for a long time or if you are new to the whole payroll process, you have to make sure that you understand the aspects and needs of your business.
Payroll Check Register Sample Templates
Accounting Payroll Register
Payroll Register Template in Excel
Payroll Check Register Sample
Payroll Check Register Sample in PDF
Monthly Payroll Templates
Monthly Employee Payroll Sample
Monthly Employee Payroll Template
Student Payroll Timesheet
Payroll Template for New Employee
Payroll Summary Template
Payroll Payslip Samples
Blank Payslip Template
Employee Payslip Template
Employee Payslip Payroll Template
Payroll Payslip Template
Daily Payroll Sample Template
Daily Employee Payroll Template
Weekly Payroll Templates
Weekly Employee Payroll Template
Payroll Weekly Spreadsheet
Biweekly Employee Payroll Template
Biweekly Payroll Calendar
Payroll Hours Templates
Employee Payroll Hours Spreadsheet
Payroll Hours Spreadsheet Calculator
Payroll Hours Calculator
Payroll Hours Calculator in Excel
Employee Payroll Templates
Employee Payroll Report Sample
Payroll Time Spreadsheet for Employees
Payroll Employee Cards Spreadsheet
Employee Full Payroll Sample
Online Employee Payroll Sample
Employee Excel Payroll Template
Payroll Register Samples
Employee Payroll Register Template
Blank Payroll Register Template
Manufacturing Company Payroll Register
Accounting Payroll Register Template
HR Payroll Register Sample
Processing your employee’s payroll may seem difficult at first but with constant practice, you will surely get the hang of it in no time. If this is your first time trying to process payroll or if you have been out of practice for quite some time, we are here to help. We will share with you a few tips on how to do payroll taxes and process payroll yourself.
This step is crucial and should be one of your top priorities when it comes to hiring new employees. One of the first things you ask an employee to do would be to fill out a W-4 form. This form will help you make all the accurate calculations regarding federal taxes and exemptions.
The W-4 form can help you determine what current filing status of an employee is and what allowances they can claim. Taxes can be greatly affected depending on the marital status of an employee. With regards to allowances that they can claim, the more the dependents they have, the more allowances they can. Plus, if the employee’s spouse is currently unemployed, another set of allowances will be given. The more the allowances an employee has, the more federal taxes are withheld from his/her gross pay.
When it comes to processing payroll, the more updated the employee database you have, the easier it will be to accurately calculate the pay of your employees. You can maintain a simple employee record to ensure that the current employees of the company are all accounted for. Through this record, you can also monitor the current salary or the hourly wage of an employee, plus keep a record of the number of hours an employee has worked. Time cards will also be a good means of keeping track of your employees’ time in and time out.
Once you have reached the cut off of a pay period, it is time for you to start computing for the pay you owe your employees. Determine if the employees are paid on a fixed salary basis or on an hourly basis.
- For computing on a fixed salary basis, check what is the annual salary of the employee and determine how many payroll periods you have for a year. The annual salary of the employee will be divided with the number of payroll periods your company has and the result would be the pay you will be giving to the employee for the current payroll period.
- For computing on an hourly basis, take note of the hourly rate and the number of hours worked by the employee for the current pay period. Multiply both and the result would be what you owe the employee for the current pay period. Take note of the overtime rendered by the employee as well and multiply it by the overtime rate your company has set.
Determine Withholding Amount
This is the reason why it is important to let the employee fill out a W-4 form in the first place. You would also need to make sure that the information provided by the employee to you is accurate as you will be the one to submit the taxes to the IRS in behalf of your employees. You can read up on our Payroll Tips from a Tax Professional to gain better insight on how you can ensure that you are calculating payroll taxes correctly and accurately.
You will also need to determine what are the other deductions that you would need to take away from the employees’ gross pay. This would include
- Social Security, and
- other taxes.
You would need to take a look and compute the taxes and other deduction from each employee individually as each employee has different deductions.
What Is the Importance of Payroll?
You may not think much of it but you or payroll coordinator is more than just a person who calculates the pay that each of your employees gets. As a matter of fact, payroll plays an important role in an organization. Through payroll, you can monitor and protect your company’s reputation by making sure that your company abides by policies and rules set out by different legislation. Payroll should never be overlooked as it affects many aspects of a company.
So what makes a payroll important? Check this out.
Boosting Employee Morale
Employees want assurance and they also want stability. With payroll, you can help assure employees that they will be paid regularly in a consistent manner. If you ensure timely and regular paydays, you avoid your employees from questioning the credibility and stability of your company. If your employees feel secure with their pay, you will avoid risking low productivity, nonperformance of employees, and unhealthy organizational environment. Remember, your employees are the backbone of your company. If you gain their trust, they will surely give you their 101% in terms of performance and doing what is required of them.
The Total Compensation Package
The payroll of an employee is more than just the numbers that he/she will be seeing in his payslip. Instead, it is more of the other things that come with it such as health care, insurance, and other benefits. If you are giving your employees the benefits that they deserve, they will feel happier and more secure in your company. Bonuses will also help to improve the performance of an employee as it will be something that they can look forward to and strive to achieve.
Maintaining Good Company Reputation
Your company does not have obligations toward your employees alone but it also has an obligation to the state by ensuring that the company is complying with tax obligations and legislation with regards to employment. By doing so, you will be able to uphold a name of being a reliable and stable company. With this being said, you are sure to become a sought-after company and be able to determine which talents are a good fit for your company.
Proper Allocation of Resources
Accuracy and precision when it comes to payroll is most certainly a must. With this being said, a company or business must be able to choose the correct mode of calculating their payroll. As mentioned in the earlier part of this article, there are four modes that you can choose from, and among the four, the most efficient would be to make use of a software and to make use of blank spreadsheet samples dedicated for payroll.
In the long run, making use of a payroll software or Excel can help you save money, which can eventually help you with the expansion of your company. Not only do these help you save on your finances but of your time as well. With more time, you will be able to help employees focus more on certain aspects of the business that needs more attention.
Useful Tips for Payroll Processing
Before we end, we would like to give you a couple of tips that would help you to efficiently process payroll.
- Keep employee records updated. Take note of the new hires, the ones who recently quit their job, and an increase in wages or salary. This would also include any changes in filing status, address, benefits, and deductions.
- Make payroll ahead of time. Once the pay period cutoff is already up, process payroll immediately before payday arrives. This way, you have enough time to make corrections regarding any discrepancies and miscalculations.
- Be transparent with timekeeping. Your employees need to know that you have kept a record of their timekeeping. Showing them your records can help them check if there are any discrepancies regarding your record and their record, and make the necessary changes and edits.
We hope that these tips we have shared will help you make processing of payroll easier.
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