Business Payroll Processing

Payroll processing refers to the task of managing the payment of wages by a company to its employees. The steps involved in payroll processing typically include gathering employee time information for a selected time period, managing benefits & deductions, and distributing employee pay for that time period.

The time it takes to process payroll can vary from minutes to days, depending on the system you use for each of the three steps. If you opt to process payroll manually, it will take longer, of course, and you may need to download free payroll templates to help streamline each step.

• Establish your employer identification number
• Collect relevant employee tax information
• Choose a payroll schedule
• Calculate gross pay
• Determine each employee’s deductions
• Calculate net pay and pay your employees
• Keep payroll records and adjust to mistakes

Tips: consider a reliable payroll software to process your payroll.

For employers paying annual taxable wages between $1.5 million and $1.7 million a reduced payroll tax rate applies which phases up to the general tax rate of 4.95% for payrolls above $1.7 million. For employers paying annual taxable wages of $100 million or less – the general rate of 5.5% applies.

Payroll companies generally charge a basic package fee. Fees may range from as small as $25 to as high as $200 per month. This cost typically includes paycheck processing, online access for employers and employees, direct deposit and basic tax filing.