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16+ SAMPLE Payroll Checklist
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What is a Payroll Checklist?
A payroll checklist is a document which has the list for the processes in doing a payroll. It carefully enumerates the steps that should be done when calculating the salary of an employee. This checklist have standard procedures that are provided by the company. Any payroll staff should follow these procedures to ensure that they will give an accurate payroll. Usually, a payroll checklist is done using a payroll software which is a complete package that can help in processing the salary of workers. The payroll checklist and payroll software will be used every month or biweekly whenever the company has to provide the compensation of its employees. Payroll can also be done every year end or quarterly. So the payroll checklist should be comprehensive and can be used for different frequencies. It is used from the onboarding checklist up to the time of a terminated employee. Salary is a crucial part of any employment, so payroll is also a crucial process. It is made easy using a payroll checklist.
Importance of a Payroll Checklist
Whether you are making a payroll checklist for new employees or a year end payroll checklist, it may be necessary for you to know the importance of having a payroll. Here are the importance that you should know:
Tips on Payroll Checklist
Considering a payroll checklist template or a monthly payroll checklist template to make a payroll checklist? Maybe the following tips can help you:
What to Include in a Payroll Checklist
There are essential things that you should include when you are making a payroll. They are the following:
- EIN (Employer Identification Number) which sets apart an employer for tax purposes
- State tax identification number and local tax identification number (used for tax deductions)
- The wage information of employee
- Bank account information of employees
- Worker’s tax forms like Form W-9, Form W-4, and Form I-9
- Withholding accounts like EFTPS account (Electronic Federal Tax Payment System) and worker’s insurance account
- Company’s budget account for the payroll
- The schedule for tax payment
- The services for direct deposit
- The schedule of payroll
How to Do a Payroll Checklist
Have you seen a payroll checklist sample or a monthly payroll sample? If you have not seen any and you are about to do a monthly payroll checklist or a year end payroll checklist, you can use the following steps in doing a payroll checklist:
Step 1: Go over the employee data.
Before you will run any payroll, you must be sure that you have not omitted any important information. Check the data of employees and know the following factors:
- Employee’s mailing address – You must be sure of the locality of each employee. A new home denotes a change in tax status so be sure of the employee’s address.
- The status of employment – It can affect the tax that an employee should give.
- Withholding tax – Be sure about this according to the employment status.
- Job title – Check if the employee has given a new position.
- Employee wage – Review if there is a change in the worker’s normal pay rate. Maybe there is an increase that has been made in the past days. Review also the hour schedule and other retroactive wages.
- Remunerations and benefits – Review the benefits that are suitable for a certain employee.
Step 2: Go over any changes in the payroll.
Employees come and go in the company. As you do the payroll checklist, you must be aware of these changes. Some of these things are:
- New hired employee – One of the things that you should do in the onboarding checklist is to include an I-9 form that can testify that they are authorized to work. They should also sign policies and handbooks, and accomplish tax forms.
- Terminated employee – There are times that terminated employees can accrue PTO (paid time off). It should be paid to them. It is a requirement that it should go together with their compensation.
- Changes in employment – This occurs when a worker is transferred to a new job. Or when they acquired a new benefit or has an increase with the pay rate. It also occurs when the hour schedule is changed.
Step 3: Accomplish the timesheets.
Go over the hours that the employees have worked. You must ensure its accuracy and accountability. Then the next question is the pay period. Does the company pay weekly, bi-weekly, or monthly? Recall that there are certain states that have requirements for the payment period. Also know if the employee is paid hourly or have a fixed income per month. Or if they are qualified to be paid for overtime. You must be sure that your timesheets will be completely accurate. Then, you should have it to be approved by the employees. Be sure that it is submitted. Be sure that you are providing a clear record, one that is complete. Have a good way on how you can track the hours that the employees have worked. Maintain all the records in a careful manner. It is necessary to have good records because employees may have complaint in your business.
Step 3: Compute the gross pay.
You should calculate the pay of the employees before the withholding. If employees are paid hourly, do the following:
- Gather the timesheets from the managers. Be sure that all of it are submitted.
- Calculate the number of hours that the employees have worked.
- Compute the pay for overtime.
- Include PTO.
- Include supplemental pay like bonuses and commissions.
If the employees have a fixed salary, do the following:
- Record the fixed salary.
- Calculate PTO.
- Include supplemental pay like bonuses and commissions.
Step 4: Compute the net pay.
You have to know how much will be deducted from the employee’s gross pay because of taxes and withholdings. Consider the pretax contributions first like benefit premiums, health contributions, retirement contributions, and any other reimbursements. Double-check all amounts to ensure accuracy. Be sure to differentiate every employee because they may be living in different states, and that denotes different amounts of taxes. Then compute for the taxes and withholdings which are the federal and state income tax, medicare tax, social security tax, and salary garnishments. After knowing the amount that you should deduct in the gross pay, subtract it and you can get the net pay of the employee.
Step 5: Review the payroll and share it to the managers.
Have a final review with your calculations. Find any discrepancies that could have been there. It is essential before you make a paper check or before you will put the net pay on the direct deposit. Update the records if you have found that there is any mistake. If all is perfect, you can submit it to the managers. Share it to them because payroll denotes a significant budget that is why it needs a payroll report.
Step 6: Do the payments and make the contributions.
Review the payment that should be given to the employee. If everything is okay, sign the paper checks or approve the direct deposit. Pay also the withholdings or taxes, and distribute all the contributions that should be payed. After that, you have completed one cycle of a payroll, and next month, you can do it again!
How Important is a Payroll Checklist?
It is very important. It has the processes on how you can calculate the gross pay and the net pay. It has also reminders on matters on how the employees can pay taxes and withholdings. Any adjustments that should be made with the payroll are also included in the payroll checklist.
What are the Easy Steps in Doing a Payroll Checklist?
First is you have to review the employee’s data. You have to be sure that it is accurate, or if any changes have occured. After checking the information, you can calculate the gross pay and the net pay. After that, you must review it and send it to the manager. Finally, make the payments.
A payroll checklist is so important because we have to ensure the accuracy of payroll. Employees should be payed for all the works that they have done, and there should be no risk assessment on it. So, a payroll staff needs to be careful in the payroll processing. The salary that he or she has to put on the paper checks should have no mistakes. Are you a payroll staff? This post can help you in making your payroll checklist. It has 16+ SAMPLE Payroll Checklist in PDF. You can use any as you do the payroll. It might be a help to you for all you know. Come and download one now!