There are a few key things to keep in mind when setting up payroll for your Small Medium Enterprise (SME). GajiCermat breaks down some tips to make this process less overwhelming.
Setting up payroll for a SME company may seem easy, but it actually takes more thought than you might expect. Payroll is highly regulated, and owners that overlook important steps in setting up payroll might find their companies facing expensive fines and penalties. If set up properly, automated payroll systems can help you streamline the process and handle paperwork, regulations, and tax compliance. Beyond compliance, employees really appreciate getting paid on time.
Here are some of the key areas to keep in mind when setting up payroll:
Use a payroll system
SME owners have a lot of responsibilities, and payroll is going to happen regularly for the foreseeable future. Doing payroll manually, issuing paper checks, or sending pay through bank transfer manually will take so much time. And navigating employee pay compliance is complex, with state and local regulations that have to be followed when paying employees. One of our most important payroll tips is that you need to choose a good payroll software system that will help you automate pay, produce accurate records, and comply with complicated requirements. At GajiCermat we typically recommend business owners to use KerjaCermat as their online attendance, and your payroll system should link with KerjaCermat. For example, GajiCermat integrates smoothly with KerjaCermat, and makes payroll run for team members simpler.
Make sure you can onboard employees easily
First impressions are important, and research has indicated that a strong onboarding process improves new hire retention by 82%. Effectively onboarding an employee requires a lot of work, so your system should allow you to easily and quickly add employees to your team. Hiring employees adds additional layers of complexity to the onboarding process, so you should make sure your software can handle onboarding as well.
Don’t forget payroll taxes
One of the biggest mistakes we see is a SME just writing employees a check and not taking out withholding taxes. If the IRS hasn’t gotten your payroll taxes at quarter-end, you’ll have a major problem with penalty notices, back taxes, paperwork, and more. Automatic deduction within your payroll can help keep you on track with taxes. Again, a payroll software system like GajiCermat can make sure you don’t violate those rules.
Choose your payroll schedule carefully
Small businesses with fewer workers may be able to pay employees weekly, but as SME scales upward and you employ more people, that may become too cumbersome. Depending on your needs, you may choose daily, weekly, or monthly. However, some states do have specific payday schedule requirements. You should consider applicable laws, your available time, and your employees’ needs when setting a pay schedule.
Run your payroll on time
Late payroll can violate federal and state laws, but the more immediate effect is on employee morale and productivity. A survey from The Workforce Institute found that 24% of workers will start a new job search after one paycheck error, and another 25% said they’d start looking for a new job after two errors. Not only will your company lose experienced employees, but turnover costs you money. This is an area where an automated system really helps out.
Streamline your payroll process by working with expert solutions
Payroll software keeps your information organized, simplifies tax compliance, helps eliminate errors and delays, and saves owner's time and money. Plus, a solid payroll automation system, like what GajiCermat supports SME for growth and success!
Streamline your payroll process by working with expert solutions
Payroll software keeps your information organized, simplifies tax compliance, helps eliminate errors and delays, and saves owner's time and money. Plus, a solid payroll automation system, like what GajiCermat supports SME for growth and success!
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