Every business, large or small, must have in place a way to pay its employees. Large corporations may have an in house accounting department. For the smaller businesses, such as are found in Monterey CA small business payroll can be managed by an outside service.
It is required that a company maintain records of all employees salaries, withholding tax, wages and any bonuses earned. All this information must be calculated before issuing paychecks. Without the payroll being functional no employees would remain on the job.
Any accounting service has to calculate federal, state and local taxes and deduct them from total earnings. Checks are then issued in the right amount for each employee. Various government agencies require all employers to withhold income taxes from total earnings.
Social Security and Medicare taxes have to be calculated separately. These are held until a later time when they are paid to the employees. Business owners pay a quarterly withholding tax that is based on how much people are expected to earn.
The required taxes to be paid by the company are held separately. They pay a portion of Medicare and Social Security. It is added to the portion paid by the employee. Although an outside agency does the work, the company owner is responsible.
The frequency at which paychecks are issued can vary. Some companies pay daily, others weekly or twice a month. Each business decides on that. A company owner may determine that money can be saved by outsourcing the department that handles issuing the paychecks.
Details that may change yearly include the percentages to be paid for different taxes. A restaurant owner must figure in the tips in all calculations. There are large manuals filled with rules and regulations to be consulted.
Taxes change frequently as to how much is deducted and for what. It can become very complicated. Whether taken care of in house or by an outside service, it is one part of owning a company that must be taken care of. It is legally required.
It is required that a company maintain records of all employees salaries, withholding tax, wages and any bonuses earned. All this information must be calculated before issuing paychecks. Without the payroll being functional no employees would remain on the job.
Any accounting service has to calculate federal, state and local taxes and deduct them from total earnings. Checks are then issued in the right amount for each employee. Various government agencies require all employers to withhold income taxes from total earnings.
Social Security and Medicare taxes have to be calculated separately. These are held until a later time when they are paid to the employees. Business owners pay a quarterly withholding tax that is based on how much people are expected to earn.
The required taxes to be paid by the company are held separately. They pay a portion of Medicare and Social Security. It is added to the portion paid by the employee. Although an outside agency does the work, the company owner is responsible.
The frequency at which paychecks are issued can vary. Some companies pay daily, others weekly or twice a month. Each business decides on that. A company owner may determine that money can be saved by outsourcing the department that handles issuing the paychecks.
Details that may change yearly include the percentages to be paid for different taxes. A restaurant owner must figure in the tips in all calculations. There are large manuals filled with rules and regulations to be consulted.
Taxes change frequently as to how much is deducted and for what. It can become very complicated. Whether taken care of in house or by an outside service, it is one part of owning a company that must be taken care of. It is legally required.
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