Payroll – keeping the wheels of your business turning

Payroll – keeping the wheels of your business turning

  

 

Payroll is usually the least popular member of business process family but is the one that quietly keeps your employees happy and the wheels of your business turning . It’s also the process that can cause your business problems if you get it wrong, which is sometimes tricky with the ever changing technical requirements. Here are our tips for staying on top of your payroll.

 Use accounting software that makes it easy

Payroll can be complicated enough so let the technology do the heavy lifting. We recommend Xero for payroll processing and Deputy for roster management. Cloud based accounting software keeps you up to date with the latest ATO tax and superannuation requirements usually with the click of a few buttons.  It makes compliance, such as the Single Touch Payroll legislation, easy to implement.

Design a foolproof process for new employee onboarding

If you get the details right upfront, you have a much better chance of running smooth payrolls in the future. Set up a checklist with all of the documentation that you need to be completed by your new employees so that nothing falls through the cracks . You will need an employment contract, tax file number declaration, superannuation choice form, and personal details form. You may also require police checks, driving records, identification. It is important to have all of these documents in place before your employee starts so that there is no confusion about the specifics of the role later. File documents in a safe place – Balanced Advantage uses a password protected digital filing system. You need to be able to access your employees’ signed paperwork at any time – you never know when you will need it.

Review your employee’s payrates regularly

As a minimum, employees pay rates are set by the Fair Work awards, which you can locate at www.fairwork.com.au, although you may agree to terms in excess of the awards with your employees. The award rates depend on the work that is required to be done by your employee, their experience/training and age. Employers are often caught out by changes to award rates, and changes in their employees’ experience level – they are not level 1 forever. We recommend regular 6 monthly reviews of your employees wage rates so you can be sure you are paying the correct rates.

 Use automated timesheets

If you pay your employees by the hour, get them to complete timesheets using a cloud based system which can then be uploaded into your accounting system. The days of plugging in written timesheets manually are long gone. We advise our clients’ employees to use the Xero app on their phones to record their time. This is then uploaded and can be approved by various management levels if required. Our larger clients use the Deputy app, also on their phones, to clock in and out each day. This automatically generates a timesheet which flows through to the Xero payroll system. We perform a review of actual hours to rostered hours to identify any “ timesheet creep” and ask mangers to sign off on any overtime worked. Deputy will even apply the correct wage rates to different hours of the day worked eg day rates vs night rates, making the whole process much easier

Pay your superannuation regularly

The ATO requires that at a minimum, superannuation is paid quarterly, at the end of Jan, April, Oct and July, although you can pay superannuation more regularly (eg monthly ) if you prefer. There are plenty of reasons to pay your superannuation on time – you can be fined significantly by the ATO, you wont get a tax deduction for any contributions paid after the quarterly deadline ( so you end up paying more tax) and most importantly your employees are entitled to this super and deserve for it to paid on time. As long as you have the money in the bank account, the superannuation process should be a simple one. Rather that make separate payments to every employee’s fund, accounting software like Xero allows you to hit one button and distribute payments to all funds at once. It couldn’t be easier.

Payroll is an important part of your business and is easy to conquer if you have the right processes. Stay up to date with award changes by following the FairWork website and Facebook page, embrace technology to meet ATO regulations, and if you need some help give Balanced Advantage a call and we can take care of it all for you.

 

Call us on 1800 883 439

 

 

 

 

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