Staying on top of your finances as a small business owner is no small feat, but it’s essential to running a successful operation. There are many accounting obstacles that most businesses face, but these are the five biggies, and what you can do to avoid them.
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Setting up a payroll management system. Following tax laws. Navigating recent tax credits and the Payroll Protection Program (PPP)…You have a lot to juggle when it comes to payroll for your small business. The experts at Sidekick Accounting Services are here to help with some timely, practical payroll tips.
Start with an Employer Identification Number
If your business is brand new, you’ll need to register for an Employer Identification Number (EIN). For tax purposes, an EIN for businesses is the equivalent of a Social Security Number for individual employees. Obtaining one should be the first financial task on yours list, as many banks won’t let you open a business account without one. Note that you may need a state-level EIN in addition to a Federal EIN, depending on where your business is located.
Determine Payroll Schedule and How to Calculate Wages
Figure out how and how often you’ll pay your employees. Most small businesses pay their employees on a weekly or bi-weekly basis; you’ll have to decide what works best for your payroll practices and what complies with federal and state minimum payday laws. When it comes to calculating wages, you’ll need to determine if you’ll have hourly employees (nonexempt) or salaried employees (exempt).
Implement a Time-Tracking and Payroll System
How will you track employees’ time and calculate their wages? Will you do payroll by hand, or use payroll software to streamline your timesheets and payroll operations? Do you have the accounting know-how to management your payroll properly, or does it make more sense to hire a payroll professional? These are all questions you’ll need to address so you can implement the best timesheet and payroll system for your small business.
Know and Follow Wage Laws
This is perhaps the trickiest aspect of payroll to navigate, yet every business needs to comply with all state and federal wage laws. You must pay the proper FICA taxes (such as Social Security and Medicare), local and state taxes, and income taxes for each employee. Be sure you’re making payroll tax deposits that synch with your scheduled tax liability. It’s important that you or someone in your business understand your legal and financial obligations.
Navigate the COVID-19 Economic Landscape for Small Businesses
You may have qualified and received a loan through the Payroll Protection Program (PPP), but perhaps you still have several questions about PPP next steps, or need information on other loan resources through the U.S. Small Business Administration. Remember that beyond payroll, there are other ways to keep your small business prosperous amidst this pandemic.
Work with Payroll Experts Dedicated to Small Businesses
Helping small businesses like yours thrive is a daily occurrence at Sidekick Accounting Services. That’s because we focus on education and support so you have the financial tools you need to triumph in your industry. We serve clients throughout Wisconsin and the U.S. with flexible, effective monthly accounting services. Contact us to learn more.
Sidekick Accounting Services is an accounting company dedicated to serving other small businesses and individuals. Helping them grow and strive to their fullest potential. With Sidekick Accounting you get a whole lot more than just accounting help, you get the tools needed to continue to be successful! We are Accounting Fit for You!!