Running a successful company is full of a lot of moving pieces. You need a great product, a solid team, hard work, and sometimes even a bit of luck to find success. There are also several different business areas that are vital to the success of your company.
One of the most important, yet underrated, business areas at your company is payroll. Payroll is responsible for getting your employees paid on time, getting them their benefits, and generally tracking everything to make sure all the numbers are accurate.
If done wrong, payroll can have several negative implications for your company. In an effort to help your payroll efforts, we have decided to take a look at a few payroll tips your small business should be aware of.
Know All of the Laws and Abide By Them
Whether you are dealing with benefits or wages, laws play a very important role. You have obligations as an employer to pay the right taxes, pay an acceptable wage, and provide certain benefits. If you do not abide by these laws, you could be penalized heavily, and in some cases, this could cost you your company. These laws or regulations can also change, so be sure you are always compliant.
While some operators will learn all of the laws, rules, regulations, and standards themselves, others decide to outsource their payroll. If you outsource, you put your payroll in the hands of experienced experts, such as those found at payrollserviceaustralia.com.au. These companies or individuals can make sure that your employees are paid on time, everything is tracked successfully and you are compliant.
Classify and Categorize Your Employees The Right Way
One of the most important things for any payroll department to handle is the classification of employees and workers. People that work for you can be classified as full-time employees, casual employees, interns, contractors, and a variety of other potential classifications. Each classification has its own requirements and rules that may differ from place to place.
It is important to familiarize yourself with what each classification constitutes, and also make sure everyone you hire and currently have on staff is classified the right way. Remember, just because someone agrees to work as a contractor instead of an employee, doesn’t mean that it is legal. Many companies aren’t aware of the importance of these classifications and their importance, so take time to make sure yours are accurate.
Keep a Close Eye on Cash Flow
One of the biggest struggles that Australian companies have is cash flow. In fact, almost half of the small businesses in Australia report being at risk of not being able to successfully pay their employees. If you don’t keep a close eye on your cash flow, there may be a time where you are unable to pay your employees.
If you find yourself struggling to make payroll frequently, take a close look at your company and identify where the issue could be coming from. This could be from overstaffing, an issue with revenue, or potentially dozens of other problems that might need to be addressed. Finding the root of your cash flow problems is extremely important in these cases.
Also, when setting your budget for payroll, don’t only think of it in terms of wages. You also need to fit benefits and taxes in there. You need to have the full picture of all that you are responsible for paying. If not, you could come up short, which can put your company at risk or lead to some very unhappy employees.
In conclusion, knowing these payroll-related tips and using them successfully should help your company operate more smoothly and ensure you stay compliant.
