20+ Sample Payroll Reports
What Is a Payroll Report?
A payroll report provides valuable information on staffing, helping employers to understand, estimate, and regulate labor costs. These are relevant tools for auditing and preparing statutory tax forms for government agencies. Payroll reports serve as references for employers to verify tax liabilities or for cross-checking financial information. The document accounts for all payroll transactions of staff within a specific period, either singular, quarterly, or annual. There are various forms for reporting payrolls, and they all depend on the type of tax. Payroll reports aid employers, lenders, and government agencies in analyzing business costs, including applying for business or personal loans.
In the most recent data from the Bureau of Labor and Statistics regarding Employment Situation Summary dated August 6, 2021, nonfarm payroll employment rose to a staggering 943 thousand in July. Most of the jobs of payroll employees are from industries related to leisure, hospitality, local government education, professional and business services. All these employees are subject to having payroll reports from their respective employers.
Components of a Payroll Report
Payroll reports are vital documents that must be accurate to the employee’s payroll. Payroll reports must contain all essential information for the purpose it serves. There are various types of documents, and each one needs different components. However, here are the common elements you can find in any payroll report for the company.
Gross pay: Gross pay represents the amount of pay an employee receives from the organization before calculating the payroll deductions or additions. This is an employee’s total rate for a particular cutoff. Adjusted gross pay: In the payroll report, the adjusted gross pay refers to the gross pay minus the pretax deductions, such as employee contributions to company plans or other related insurances.Net pay: The net pay on the payroll report reflects the amount an employee receives after taking out the taxes, deductions, and other computations. It is the total payment amount an employee receives on a payroll check or through direct bank deposits.Employer taxes and contributions: This section of the payroll lists down the payroll expenses incurred by the company or employer for Federal Insurance Contributions Act (FICA) tax, unemployment taxes, and other tax liabilities under law. Comparative data: Comparative data helps with analyzing payroll expenses. It allows you to identify payroll errors quickly and efficiently in comparison to recent information. The data comparison also provides potential investors an understanding of the organization’s financial status over time. Pay period: At the beginning of every payroll report, it is critical to indicate the pay period the company is reporting. It is also necessary to be specific in writing the pay period, including the quarter and the year.
Types of Payroll Reports
As mentioned earlier, a company makes use of various types of payroll reports. The use of these reports varies depending on what purpose they may serve. Below are the common payroll reports an organization uses for employees or the business.
Company-wide payroll reports: Otherwise known as payroll register or a payroll journal, these reports give employers a general view of payroll expenses. It also gives the breakdown of compensation, deductions, and taxes up to its smallest details. The report holds information about employees’ worked hours and the FICA tax incurred by the employer in the previous pay period. Recognize that the payroll register contains personal information and must not be shared with any third-party entities without an employee’s consent. Employee-specific reports: Employee-specific reports go by many names, including pay stubs and employee earnings reports. It details the compensation, taxes, and deductions of individuals in the company and provides a granular view of the organization’s payroll system compared to a payroll register. Employers are obligated to provide copies of pay stubs to employees under the Fair Labors Standard Act (FLSA).Employee time reports: These reports are used to calculate the time an employee reports for work in a given period; think of it as time logs. This type of report proves useful for output-based work by comparing an employee’s work hours to the products they provide after a workday.Cash requirements reports: Cash requirements reports inform companies of the required amount of cash to start processing payroll. It details how the money is cut to direct deposits, taxes, and other expenses and deductions. It is a necessary document to help you with payroll management procedures.Payroll tax reports: These are the annual or quarterly reports that the federal, state, and local governments require organizations to present for recording payroll liabilities and employee compensation. There are various reports under these types of documents and will be discussed further.Paycheck Protection Program (PPP) reports: In terms of small businesses, there are certain prerequisites to meet before qualifying for forgivable PPP loans. These reports help businesses to compute their loan amount by looking at previous data from the past years.Certified payroll reports: These documents are required out of contractors and subcontractors working on government construction projects. Various government departments provide blank forms to fill out. It is also crucial for these individuals to follow the standards set by the Department of Labor for federally certified payroll reports.
Types of Federal Payroll Reports
Businesses are not required to submit payroll reports to a third party unless the Internal Revenue Service (IRS), employee’s carrier, or state agencies audits them. However, businesses must submit quarterly and annual reports to federal, state, and local governments. Below are the federal payroll report forms organizations must accurately fill out and submit to necessary agencies.
Employer’s Quarterly Federal Tax Return: Otherwise known as Form 941, is the most prevalent way for businesses to relay their federal payroll taxes. The report contains information about employees’ paid wages, withheld federal income taxes from employee’s wages, Medicare and Social Security deductions, and employer contributions to these taxes. Employer’s Annual Federal Tax Return: Prominently known as Form 944, used by businesses to file their federal tax returns annually. Organizations permitted to use this form annually pays liability for Medicare, Social Security, and other federally withheld taxes for less than 1,000 US dollars.Employer’s Annual Federal Unemployment (FUTA) Tax Return: Form 940 is used by businesses to report and pay FUTA tax. The due amount can go up to 6% if the employee earns 7,000 US Dollars or less if the company pays state unemployment tax. FETA tax is due every January 31st.Wage and Tax Statement: Employees fill in Form W-2, containing their gross income, tax deductions, and other information regarding wages and benefits for the year. Employers must provide copies of the statement and submit it to all necessary agencies.Transmittal of Wage and Tax Statement: Meanwhile, W-3 summarizes the organization’s wage and tax statements given to the Social Security Administration. Together with Form W-2, it must be submitted on January 31st of the following tax year.
How to Create a Payroll Report
With various types and forms, the creation of payroll reports can be quite challenging to many. The payroll report must be accurate and factual, especially as federal, local, and state governments require copies of these reports. Below are helpful steps that you can use to create your company’s payroll report.
Step 1: Identify All the Necessary Information for Your Report
Every payroll report starts with recognizing the details you need to input in your document. It is also the company’s responsibility to limit the information they give to third parties, especially if it concerns details about the business and its employees. For example, if an employee is trying to apply for a loan for income verification, you will want to restrict unnecessary information, instead, indicate the employee’s wages, taxes, and fringe benefits.
Step 2: Select the Period of the Report
Unless the purpose for creating the payroll report is for submission to the IRS, you can choose the report’s time period. It is under your jurisdiction to create reports that can aid you with explaining various trends and fluctuations clearer to employees or the management. For example, creating a monthly payroll report.
Step 3: Include the Essential Payroll Data
In choosing to input payroll details, the best application you can use is Microsoft Excel; it is every human resources staff and accountant’s best friend. There are plenty of Excel templates for payroll worksheets available online from trusted websites. These templates resemble the payroll outline you can have for your company, customizing it to fit the business’ needs. Once you have a workable sheet, you can input all essential information into your payroll system. Be wary of formulas and entries for your system and familiarize yourself with the application.
Step 4: Review the Results of Data
After processing the data and finalizing the draft of your report, guarantee that the document is free from errors, and note the insights you can add or improve for the following reports. Note the fluctuations in employee payroll rate, tax deductions, and other relevant information relating to the payroll system. If you are creating a report specifically for a third party, decide if it is better to provide a narrative report rather than a report showing figures. The report you send to lenders or banks says a lot about the company’s ability to gauge their knowledge about these documents.
What is the purpose of constructing payroll reports?
For one, constructing payroll reports allow you to understand your business better. Collating accurate and up-to-date information allows the company to make more precise and informed choices. It also helps with other relating detail, including employee turnover rates. The reports also help with understanding employees better. By referring to the reports, you can infer which employees are performing well and give interventions to those underperforming. It also helps to visualize the data quickly and easily, using it to compare payroll trends and costs.
What is a payroll summary?
A payroll summary provides brief information about a business’ obligations connecting to payroll within a specific timeframe. The document lists an employee’s wage earnings, withholding taxes, deductions, and all other taxes owed by the employer.
What payrolls costs are eligible for PPP forgiveness?
Small businesses construct PPP report or Paycheck Protection Program report to apply for forgiveness for clearing debt, especially for applying for loans. A business or individual seeking forgiveness if the proceeds are for payroll, mortgages, rents, and other essential utilities ranging from the eight and 24 weeks from the start of disbursement of the loan’s proceeds.
What payroll reports are due on an annual basis?
Remember that payroll reports are presented to government agencies only during audits. These documents are necessary when filing annual tax forms, including Employer’s Annual Tax Return (Form 944), Employer’s Annual Federal Unemployment (FUTA) Tax Return (Form 940), Wage and Tax Statement (Form W-2), Transmittal of Wage and Tax Statements (Form W-3), and Nonemployee Compensation (Form 1099-NEC).
Businesses prepare payrolls for their employees every cut-off to list the employee’s pay, including tax deductions. Payroll reports serve both the company and the employee’s benefit. These documents help the organization track its spending and financial status. Meanwhile, employees use these reports to accomplish their respective federal tax forms. The company must have sufficient knowledge in creating these documents, especially accounting and human resource staff. Familiarize yourself with using payroll reports by using and downloading the sample templates above. Start writing up your payroll reports today!