Processing your own payroll may be easier than you think, but it can be time-consuming for business owners with full dockets. To keep things simple, we’ve compiled the steps you need to take for processing payroll of your employees, including how payroll taxes are calculated. We’ve uncovered how scalable payroll service solutions are depending on the size of your organization and briefly listed payroll software options you can utilize for both small and large businesses.
Want to find ways to save time spent on figuring out payroll? Alternatively, we’ve also listed options for business owners who want to free up time.
There are several pros and cons to consider when determining whether you want to do your company’s payroll as a business owner. It costs less, but it takes more time. You can do it on your own terms, but it’s more likely you’ll encounter payroll errors if you do it yourself. As a business owner, you’ll be tasked with determining whether you’d like to manage your payroll service solutions yourself, or if you’d like to utilize other avenues for paying your employees.
To give you a better understanding on whether you should do calibrate your own payroll systems for your business, here's a brief guide to how to do payroll for your organization:
For each new employee you hire, you need to file a new hire report. To get paid, all your employees need to fill out IRS Form W-4. This form allows them to document their filing status and keep track of personal allowances. Keep in mind that the more allowances or dependents your workers have, the less payroll taxes are taken out of their paychecks each pay period.
Before you do payroll yourself, make sure you have your Employer Identification Number (EIN) ready. An EIN is used by the IRS to identify you as a business entity and anyone else who pays employees or contractors. You may also need to get a state EIN number, so check your state’s employer resources for more details. Here's Denver's employer resources.
After you register for your EINs, get insured. This'll make sure you can provide workers’ compensation. In addition, you should display workplace posters, and you need to add three important dates to your calendar:
- Employee pay dates
- Tax payment due dates
- Tax filing deadlines
The above will keep you in compliance with basic labor laws. Click here to learn more about these laws.
When it comes time to pay your employees, you need to determine which federal and state taxes to withhold from their pay. You can do so by using the IRS Withholding Calculator or another paycheck calculator (which come from an online payroll service provider). Keep in mind that you'll be responsible for tracking both the employee and employer portion of taxes as you go.
When it’s time to pay taxes, you need to submit your federal, state, and local tax deposits, as applicable. This usually happens on a monthly basis.
Finally, be sure to send in your employer federal, state, or local tax returns. Finally, you'll want to prepare your annual filings and W-2s at the end of the year.
As an employer and business owner, you can definitely undertake the task of payroll on your own. However, it can take away precious time from other tasks that need to be accomplished to keep your business running smoothly. Not only that, but ensuring you're accurately doing your payroll can add to the overall stress of running a business.
An alternative to managing payroll tasks yourself is utilizing either an online payroll service software or hiring an accountant. Let’s cover both options in more detail below.
Using a payroll software as your chosen payroll solution can definitely save you time and keep your records accurate and up to date. You can use payroll software to handle your payroll taxes, filings, new hire reporting for you, and allow you to complete payroll online. What services are available to you largely depends on the payroll software you select. For an in-depth guide on our top picks for payroll software in 2023, check out our blog dedicated to the subject. Here's a brief overview of our top picks:
If you want to save time on both doing payroll yourself or working with an online payroll service solution, you can alternatively hire an accountant to handle your payroll tasks. An accountant can help you handle growth transitions, such as hiring employees or taking on more office space. They'll look after the details involved in payroll and employee tax management. It’ll leave you with the time you need to look at the bigger picture of the way your business is growing.
Not only do accountants handle the specifics of how to do payroll, they also do the following for businesses:
We understand payroll and getting employees paid for businesses in the Denver area. That’s why 4Corner Business Service's team of experienced accounting and small business consulting experts provide you with the tools you need to keep your business running smoothly so you can focus your attention on other tasks.
Allow us to be the experts on bookkeeping and payroll for your Denver, CO company. In addition to bookkeeping and payroll services for small and large businesses, 4Corner offers support in choosing and using accounting software, professional tax services, and valuable financial advice to guide decision making. We help businesses both large and small implement proven growth strategies so you can turn our small business consulting services into revenue successes.
We’ll take the guesswork out of payroll so you can tackle more projects. If you have any additional questions, feel free to contact us at 4Corner Business Services. You can set up a meeting with Phil Zavala, founder of 4Corner, to get you on the right track.
Being a small business owner can be exciting and frightening at the same time. Every business owner has their own reasons.
If you’re a small business owner or thinking about starting a small business, you’re likely focused on saving as much money.
Payroll might not be the first thing that jumps to mind when you think about making your construction business efficient.