The idea of running HR payroll might seem simple enough, but for some business owners, it can feel like you’re trying to learn an entirely new language. That’s because business owners are typically the people who come up with all of the ideas and not the ones in charge of paying the employees who make those ideas happen.
So if you’re not as familiar with the more common HR payroll questions, here are some of the more typical payroll questions you might find yourself asking someday.
There are a few HR payroll terms that will come up fairly often that you should be knowledgeable about. Those terms include deduction, gross wages, net wages, and compensation.
Deductions are how much money you withhold from employee paychecks.
Gross wages are how much an employee would take home before deductions, while net wages are how much an employee is left with after those deductions are taken out.
Compensation is everything you give the employees in return for their work, which can include benefits.
An EIN is known as an Employee Identification Number, which is a number assigned by the IRS so that you can identify your business from others on tax documents. It is very similar to a Social Security Number since it is also a taxpayer identification number. You’ll need to apply for an EIN number when you become an employer.
Believe it or not, there are many different ways that you can run hr payroll for your company. One option is to run payroll by hand, but you can also use HR payroll software. Additionally, you can outsource your payroll to a specialist. The most expensive option tends to be outsourcing while learning how to do HR payroll by hand is the most cost-effective. Many consider the use of JR payout software to be a good middle ground.
Last, but not least, you might wonder how long you should keep HR payroll records on hand. The truth is that you should keep them for at least three years, even though that might seem like a bit much. Not only that, but you should also keep all of your employment tax records for at least four years–and that’s after filing the fourth quarter of the year.
In other words, you’ll want to plan for HR payroll record retention for a long time, since it’s always better to be safe than sorry.