‘Payroll processing’ is one of the most complicated yet important HR functionalities within any business. Companies can keep their staff happy when accurate payroll is done on time. Also, keep employers safe from legal troubles.
With the help of advanced technology, the right tools and proper planning, some common payroll errors are easily avoidable. Here, you will find 6 smart ways to avoid payroll errors:
- Timely and accurate payroll needs planning
Salary processing involves so many steps and hence, employers may fail to stick to their timeline. It can damage employees’ trust and opinion towards the company. So, set a deadline for both- external for taxes and internal for paydays and stick to your schedule. After all, timing and accuracy are everything in payroll.
- Invest in payroll software
Select cloud-based payroll software and keep payroll mistakes away from your company. It will manage and update all important information related to employee salary processing including statutory compliances. This software can sync with your HR system and automate this time-consuming task. It can run reports, distribute pay stubs and file taxes for your organisation as well.
- Select the right time tracking system
HR needs to keep track of deductions, overtime, shift timings and more while calculating pay and hence, choosing the right time tracking software is a smart way for smooth payroll processing. Else, poor time tracking capabilities can result to miscalculation of pay.
- Correct employee classification
Some employers misclassify their staff which means these employees may miss some important benefits and wages. Correct classification of employees is necessary to avoid underpayment or overpayment. Ensure they are in the right tax slab!
- Maintain and review payroll record
Being HR, you need to maintain and review all payroll related records like deduction report, attendance report as this practice can keep your company safe for future audits. Also, it helps you to process error-free payroll!
- Keep a checklist of legal documents ready
Keep a check on deadlines for payroll taxes because missing a tax deadline can cost your employer a considerable amount of penalties or even legal consequences. Especially at the financial year end, make sure that your payroll records are up to date and meet all legal guidelines.
Payment related issues can lead to poor productivity and low morale of staff. Adopting smart ways to avoid payroll errors can nullify the effects before they can even begin to take shape.