If you fail to notice regulatory changes and incorrectly calculate employee pay or tax liabilities as a result, you could face significant fines and penalties. But they do-and there are federal, state and local regulations to contend with. It would be nice if laws and regulations didn’t change. Staying in the loop with employment law and regulatory changes. That’s why it generally makes sense for growing businesses to automate the process using technology from a software or a payroll service provider. There’s no built-in mechanism to avoid mistakes, stay up to date with regulations or protect confidential information. But it’s time-consuming and error-prone, and the complexity and risks increase as your business expands and you add employees. Manual processing with spreadsheets or other basic tools can seem a cheap option, and it may be adequate for very small businesses. Here are 16 of the most common payroll challenges encountered by small businesses, and their solutions. 16 Common Challenges for Small Businesses and Their Solutions Anything that simplifies and automates the tasks of payroll processing is likely to be welcomed. If the tools they are using to manage payroll aren’t integrated with their accounting system, they’ll need to enter payroll data multiple times to keep the company’s accounts up to date. When handled manually, calculating wages, taxes and other payroll deductions can be a time-consuming process that requires great precision to ensure employees are paid accurately and that the company complies with all regulations. What’s Important to Bookkeepers When Processing Payrollįor bookkeepers in small businesses managing payroll can present a significant burden, especially since they’re generally also handling many other accounting tasks every day. It’s vital to get it right: Paying employees inaccurately or late can seriously damage staff morale, and non-compliance with tax or labor laws can lead to significant penalties. However, managing payroll is a critical aspect of running any business with employees, and it can present a wide variety of challenges. If you’re like them, you’d probably rather focus on keeping your products or services competitive and your clients happy. Most entrepreneurs don’t go into business with the goal of spending their time processing payroll. East, Nordics and Other Regions (opens in new tab)
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