Payroll ledgers help small and medium-sized business owners keep track of vital payroll information, like staff names, salaries, and payment schedules. When running a small business, keeping your payroll information well organized is essential for balancing monthly budgets. Payroll ledgers help you keep all that information in one convenient place for reference later.
In this post, we’ll walk you through the reasons that payroll templates are important, explain how to use them, and provide you with a downloadable employee payroll ledger template. Read on to find out more, or use the links below to answer your specific questions.
- How do you create a payroll ledger?
- Printable and editable payroll ledger template
- What to include in a payroll ledger template
- How to use the payroll ledger template
- Why should you use a payroll ledger template?
- Using a manual payroll ledger template vs. payroll software
Why should you use a payroll ledger template?
The benefits of ensuring that your employees are being paid fairly and in full, and all your payroll details in one place come tax time cannot be understated. Whether you run a small business that’s just starting out or an established business that’s ready to expand, a payroll ledger template can be a valuable tool.
A payroll ledger is a system for keeping track of payment information for each employee or contractor who receives payments from the payroll department of a firm. Payroll ledgers can be physical paper spreadsheets or digital spreadsheets. Payroll ledgers allow business owners to quickly see how much money they’ve paid out, whom they’ve paid, and when. In addition to being essential for payroll records, these ledgers may also serve as important documentation for tax purposes and other record-keeping needs.
Like other general ledgers, the aim of a payroll ledger is simply to keep all your relevant information conveniently in one place. Small business owners may struggle to organize important business data, especially as they grow from a smaller organization to a larger one with more employees. A payroll ledger is one solution to ensure valuable data isn’t lost as you scale.
Using a payroll ledger template is a quick and easy way to keep track of crucial payroll information in one convenient place. By using a template, you can also avoid having to build your own payroll ledger system from scratch.
How do payroll ledgers differ from timesheets?
Payroll ledgers allow you to track multiple employees’ pay information, whereas a timesheet is usually dedicated to tracking just one employee’s hours and pay. Timesheets can be a great source of information for payroll ledgers. It may be a good idea to learn how to leverage each time tracking method to your organization’s advantage. For starters, you can use our timesheet template to streamline your processes and keep organized records.
How do you create a payroll ledger?
Creating your own payroll ledger is simple, and it can be done in just a few steps. Here’s what you’ll need to get started:
- Spreadsheet software, like Microsoft Excel or Google Sheets
- A list of your employees and contractors
- Payroll information, like invoices or pay stubs for employees
Creating a payroll ledger in Excel or Google Sheets
Once you’ve put together all the necessary information, knowing how to make a payroll ledger is as simple as following these steps:
- Open a new worksheet using your spreadsheet software. Be sure to name it something intuitive and searchable, like “2021_Payroll_Ledger.” It’s also a good idea to store it in a clearly named folder, like “Payroll Information.”
- Select the first column (the vertical series of cells in your spreadsheet). Name it “Employee Name.”
- If applicable, name the next column “Employee ID Number.” If you do not use employee ID numbers, you can skip this step. (Note, you may also want to include a column with basic contact information, like an email or phone number.)
- After this step, create a series of columns that reflect the different pay information that may apply. For example, this might include “Hourly Rate” or “Rate Per Word,” or “Overtime Rate.” Be sure each has its own column.
- Create a column for “Date.”
- Create columns titled “Net Pay” and “Gross Pay.”
Once you’ve finished setting up your spreadsheet, be sure to save it. Then, start inputting the correct information into each cell.
Pro tip: Most spreadsheet software allows you to create new sheets within a spreadsheet, using the tabs at the bottom of the window. If your spreadsheet becomes cluttered, or you want to start new sheets for each pay period, it can be helpful to create new tabs.
Printable and editable payroll ledger template
Click on the link below to download QuickBooks’ free employee payroll ledger template.
Payroll ledgers serve a number of essential functions for businesses:
- Keep managers and business owners on top of necessary employee information.
- Ensure that information is in an easily accessible place in the event of a dispute.
- Track payroll expenses in one place.
- Organize important tax information in a convenient location.
Download the free printable payroll ledger template to start tracking pay in a simple way. You can also use our payroll calendar templates to set up payroll tracking based on your pay frequency.
What to include in a payroll ledger template
Here’s what to include when making your payroll ledger:
- Employee names (and ID numbers if applicable)
- Pay rate
- Pay period
- Gross pay
- Net pay
The template makes it easy to input and customize information as needed, so feel free to build out your payroll ledger to suit your business’s needs.
How to use the payroll ledger template
To use the template, follow these simple steps:
- First, start by inputting the information above into each column of the spreadsheet.
- Then, enter each employee in their own row, under the employee name column.
- Use the column headers discussed in the How do you create a payroll ledger section above to input the correct information for each employee.
- Be sure to double-check your work.
You can then keep the ledger on hand for use in accounting and bookkeeping, tax preparation, or business forecasting and planning.
Learn how to use a payroll ledger most effectively for your business.
Using a manual payroll ledger template vs. payroll software
While payroll ledgers are a useful way to track and manage your employees’ pay, as a business owner, you have more options. Payroll software like QuickBooks Payroll incorporates functionality present in a payroll ledger while automating the input. By using software, you can keep tabs on employee pay, withholdings, gross pay, net pay, etc. much more efficiently.
Payroll software can also eliminate a major source of excess costs for small businesses—human error. Automating data entry means that you don’t have to worry about input errors, plus it means your employees can allocate that time to other tasks. And by automating the technical aspects of your employee payroll, you can ensure that your team is paid on time and in the correct amount. Plus, all the information you need to fulfill your IRS obligations will be in one place ready to import into your favored business tax software.
A payroll ledger may have some advantages for smaller businesses—they’re free, easily updated, and used to keep tabs on important information. But as your business expands, payroll ledgers can encounter some disadvantages. It may become more efficient to use dedicated payroll management software, like QuickBooks Payroll.
Before, you needed separate schedule templates, timesheet templates, budget templates, budgeting software, time cards, and payslip management strategies. But with QuickBooks Payroll, you can keep it all in one convenient place.
A few advantages of this software include:
- Tax penalty protection
- Time tracking
- Same-day direct deposit
- Auto payroll
- Automated payroll taxes and forms
- Expert support
While payroll ledger templates are highly useful for managing your payroll ledger, they can be time consuming to complete. On the other hand, dedicated software is often a more efficient and error-reducing method for managing your payroll ledger. For everything from tracking payroll deductions and tax compliance to creating payroll reports and ensuring pay periods are consistent, QuickBooks Payroll has you covered. After you’ve checked out the payroll ledger instant download, consider the ways that implementing dedicated payroll software in your organization can streamline business for your team. Get started with QuickBooks Payroll today and see how it can transform your payroll processes.
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