Payroll is one of the most important parts of running a business.
But for many employers, organising everything can be a bit of a struggle – especially in the midst of trying to expand and grow an enterprise.
Yet payroll remains a crucial part of the business process, and as a result, entrepreneurs can’t afford to make mistakes.
Here are our tips to consider when doing your payroll that will save you a heap of stress:
1. Check all your employee details
First thing’s first – make sure all the information provided by your employees is up to date and accurate, including:
- Tax file number
- Full name
- Start date or termination date
- Date of birth
- Current address
- Pay details including gross wage, allowances, hourly rate and the employment period.
2. Reporting and reconciling
The reporting requirements on payroll vary from state to state. Generally, payroll tax is payable monthly, and you must complete a monthly payroll tax form and lodge this with the state tax office.
You’ll be required to complete and submit an Annual Reconciliation Form with the state every year, reporting the annual taxable wages and premiums paid over the year. The Annual Reconciliation Form will help you with determining your tax amount — whether you still owe the state, or they owe you a refund if you’ve overpaid. If you employ staff in many states, then you will be required to complete many state Annual Reconciliation Forms.
Make sure you review these rules and processes so you’re not making any mistakes!
3. Keep up to date with payroll tax changes
Payroll isn’t just a “set and forget’ procedure. Tax rates change every year, and from 1 July you’ll need to make sure you’re compliant with the current tax rates.
4. Don’t miss the payroll deadlines
You don’t want to miss your deadlines – do you know when they are? The three you need to know about are:
- PAYG withholding. The tax you withhold from payments you make to employees and businesses.
- Payment summaries. These are summaries of how much you’ve paid each employee during the year.
- Super reporting. There are multiple deadlines for paying and reporting superannuation contributions – make sure you don’t miss them – including the government’s SuperStream requirements.
Subscribing or upgrading your MYOB online accounting software will ensure your business is always compliant with tax changes, including the government’s new SuperStream system for paying super contributions.
Want to learn more? Download MYOB’s guide to avoiding payroll mistakes or call the team at Mitchell Partners in Surrey Hills VIC on 03 9895 9333.