What is payroll?

Payroll is an overall term used for several types of operations related to paying employees and paying payroll-related taxes due to federal and state agencies. Payroll plays a major role in the internal operations of a business for several reasons. From the perspective of accounting, payroll and payroll taxes are subject to laws and regulations. Payroll is subject to federal, state, and local regulations including employee exemptions, record keeping, and tax requirements. Payroll also plays a large role from the human resources point of view. Payroll errors, such as late or incorrect paychecks, are a sensitive topic that can cause tension between employees and their employer. One requirement to maintaining high employee morale is that payroll must be paid accurately and in a timely manner because employees are very sensitive to any payroll errors.

The term payroll has several different parts.

• The calculation and distribution of paychecks (physical or electronic) to employees each payday.
• The financial records for employee wages and salaries, withholding, deductions, bonuses, pay for time not worked (holidays, vacations, sick time, etc.), and other items on employee paychecks.
• It can also mean the record of total earnings of all employees for a company in a fiscal year.
• The calculation and payment of payroll taxes that are taken out of an employee's check, which includes Social Security, or FICA, and Medicare taxes.
• The calculation and payment of payroll taxes that employer's must pay, which are FICA, Medicare, FUTA, and SUTA.

Why outsourcing payroll may be the right choice for you.

Payroll must be processed on a recurring basis and must be accurate each and every time. Since payroll is the single largest expense for most companies, it is very important that payroll is processed in a way that is efficient and reliable. Outsourcing payroll will save you labor time and prevent costly errors because a high degree of accuracy and reliability is ensured.

Keep your focus on your business and your profits.

Let Sibley & Associates run payroll for you, and you can get back to running your business.