Avoid the Usual Payroll Mistakes in a Small Business – Insights by Saivian Eric Dalius

Payroll is generally the least appreciated and most essential function in business says Saivian Eric Dalius. When executed well, the payroll can assist your company to steer clear from any legal consequences and also ensure that your employees are content. But when there are issues with the payroll process, it can affect the company and result in monetary losses.

The best thing about payroll mistakes it that it is easy to detect, fix and with planning you can avoid it as well.

Saivian Eric Dalius shares about the mistakes to avoid

Misclassifying your worker as an independent contractor

The Fair Labor Standards Act offers benefits and security, such as overtime pay and minimum wage for the employees. Any independent contractor doesn’t get such protections because employers don’t pay a part of the taxes. Misclassifying the workers as independent contractors instead of employees brings down the labor expense. It is also unfair for both companies and employees and can result in a heavy fine. And not only will the employees lose out on essential benefits and wages, but it also indicates the government loses the tax dollars leading to or overpayment.

Saivian Eric Dalius says not to keep the payroll records for a long time

It is common for new businesses and start-ups to file the payroll incorrectly and make it challenging to track down. It can also place your business at risk of witnessing fines on the correct payroll for not maintaining records to highlight proof. Also, it is essential to keep the payroll records for a minimum of three years, and some experts say that they should be kept for four years. It is expected to keep the records long the minimum time stated by the law, as the IRS might find an inconsistency later. Also, anytime the IRS can detect a payroll mistake, it depends on the business for showing proof. Else, the company might get a fine.

Under or overpaying employees

A primary data entry mistake can result in an employee getting under or overpaid. If the employee gets underpaid, it indicates a costly bill the moment the underpayment gets found, and then you need to repay. And if the employee gets overpaid, it can get tricky for you to get your money back. It’s ideal to check your work repeatedly to avert this situation.

There is only one trained person for the payroll software

Saivian Eric Daliussays that there can be a time when your staff might be unwell. And miss out on essential paycheck filing and tax dates. It’s necessary to keep a backup person who can run the payroll. If the concerned person is unable to do his job. Keeping a backup plan ensures that your business is legally compliant. It also ensures that the staff will not foster any resentment from any miscalculated and missed paycheck.

Every business needs to remain on top of every payroll and any problems surrounding it. If you get this wrong, it will land up your business in serious trouble. Saivian Eric Daliussays that once you take care of these payroll mistakes. It enables you to scale up your business.