It’s essential to know how to set up a payroll system by yourself, especially when dealing with one employee. This helps to avoid IRS penalty fees.
Here is a helpful guide on how to set up and do payroll for one employee.
Choose a Payroll System
Various payroll companies have quality services. Among these companies is the Symarco payroll, whose information is available on www.payrollserviceaustralia.com.au/.
But, if you’re planning to do payroll by yourself, you need a payroll software system. Several software options provide quality services, just like companies.
With a sound payroll system, you don’t have to calculate equations or input information manually. Input your employee’s name, social security number, among others into the payroll system.
Ensure you get the best software to avoid errors.
Choose Between Hourly and Salary
You may choose to pay your employee according to the job done, on an hourly basis, or both. If you don’t want to pay your employee for the overtime, you may opt to pay them a salary. However, for a nonexempt employee, you can pay them hourly.
Before setting up a payroll system, decide which payment option is the best for the company and the employee.
Decide on Pay Periods
Most workers enquire about the payment period before accepting the job. As a company, it’s crucial to determine which pay periods work for you. After this, you can disclose it to your employees.
Some of the most popular pay periods are monthly, semi-monthly, weekly, and bi-weekly. When working with one employee, determine one pay period and stick to it. You don’t want to demotivate the employee by always delaying their paychecks.
Determine this pay period early to avoid frustrating the employee.
Track Employee Hours
It’s important to track employee hours to set up their payroll. You can use time cards, get the employees to enter their working hours, or track computer logins. Consider the growth of your company and the number of employees to intend to have when making your decision.
Often, not all employees are honest enough to track their working hours.
If you decide to track employee hours using the payroll software, ensure you activate the action. This reduces most payroll mistakes. Also, it fastens your payroll process.
Determine the Taxes You’ll Withhold
You need to consider various types of taxes, including federal, state, and local. Learn the types of taxes that you need to withhold when preparing the employee’s paycheck. Use the IRS website to get more information concerning these tax withholdings.
The website has information on medicare taxes, federal unemployment tax, social security, and federal income tax. This information helps you do your employee’s payroll legally and worry-free.
Payroll For One Employee Set Up
It’s easy to set up a payroll for one employee on your own. First, you need to choose the best payroll system. Decide whether you’ll pay the employee hourly or on salary.
Come up with the most convenient pay period to avoid frustrating the employee. Input the employee tracking strategy in your system. Finally, consider taxes that you’ll need to withhold from the employee’s paycheck.
