Running a new business is no easy task, and it becomes even more complicated when the first employee is brought on board.
Paying staff brings a host of new responsibilities, including proper record keeping and tracking various superannuation accounts.
For new employers, paying staff can be a hassle. But it shouldn’t be. We’ve put together a handy checklist for new employers to make paying staff easy:
1. Confirm your employee details
First thing’s first – do you actually have everything you need to start paying people?
To pay your employees you’ll need access to their Tax File Number. Make sure you have all the information in order, including their bank details – it can’t hurt asking your employees to check their details again. You don’t want pay going into the wrong accounts.
2. Reconcile your accounts
Reconciling your accounts takes a few steps, but it’s nothing that should be overwhelming. Here’s a handy guide:
- Reconcile total gross wages of the payment register YTD report to wages expense YTD.
- Reconcile outstanding PAYG liabilities to unpaid PAYG for the next Business Activity Statement.
- Reconcile outstanding Super liability to unpaid superannuation for the month/quarter.
- Reconcile payroll tax for the year.
3. Print your reports
Prepare your payroll payment register summary YTD report, along with your payroll entitlement balance summary and detail report.
4. Reconcile PAYG withholding
PAYG tax is an imperative part of the payroll process. Make sure you don’t miss out on an important step:
- Reconcile unpaid PAYG to balance sheet and PAYG liability
- Check PAYG paid for the year to payroll summary YTD tax
- Check PAYG paid for the month or quarter to the relevant payroll summaries
5. Prepare payment summaries
Preparing payment summaries for your employees is one of the most important tasks of the year. You should make sure all of the relevant information is recorded and provided:
- Assign payment fields for gross payments and allowances.
- Record ETP if applicable
- Record RESC superannuation if you need to
- Record any reportable fringe benefits
- Verify payroll information with the payroll register summary
- Print payment summaries and distribute to employees by the 14 July – and store PDF copies in a yearly payroll folder.
Preparing payroll shouldn’t be a hassle – refer back to the checklist if you ever find yourself in a bind.
Want another resource for keeping track of your payroll responsibilities? Download our handy payroll guide for new employers here. If you don’t have MYOB online accounting software, there’s an online accounting solution for every stage of your business.