It may not be your fiscal year end, but the end of the calendar year may be giving you similar anxiety pains as you question your record keeping, your formulas and calculations.
Employees want their P60 PAYE forms and the government wants to check if you owe them money. If you don’t submit your company tax returns on time, you’ll pay penalties.
The big question is, has your system been working? If you’re not using an automated system or an integrated system with your current accounting software, you’ve been relying on your formulas, calculations and manual data entry to get you by. Has it been enough?
Over the years, there have been far too many occurrences with new clients where I am sitting mid-January with a year’s worth of payroll records spread across my desk. I’m trying to calculate each and every payroll run for the entire year because the client used their aunt’s spreadsheet which hasn’t had updated tax figures since 2010. It just didn’t occur to my client that these numbers change yearly.
Another common error I see with Excel is where the user accidentally hits space bar and deletes the formula mid spreadsheet. And of course no one notices because the final formula still shows and there is no data verification over the spreadsheet.
I am kind and patient but one thing I have to enforce with my new clients is that I cannot be involved in their year-end reconciliations if they succumb to the use of spreadsheets to track a task that holds such high responsibility to the employer and can carry significant penalties. In one year alone I had 7 meetings (each for a different client) with HMRC to explain why my client miscalculated, under deducted or were late in paying. Each client was one who used manual paper to record, missed tracking all their maximums or had a faulty excel spreadsheet. And each client ended up paying up to £3,000 in penalties.
The most important task you have as an employer is to stay compliant with payroll guidelines and regulatory requirements. What does that really mean? It means stay up to date with current tax rates, as they’re likely to change annually, track holiday and sickness pay, overtime, benefits and other things you may have to record or shell out on like stock options. This is a lot to manage and could potentially take up a lot of time when being done manually or separate from your current accounting system. So how much less time can you be spending managing your employee’s pay?
With so much to already remember between due dates, managing vendors, customers and employees, automating your payroll processes and even better, integrating this automation with your already existing software can prove to offer some undeniable benefits.
1. Integrating software eliminates the possibility of transposition errors
Stop copying the figures from your online payroll calculator or third party payroll service into QuickBooks. There is too much room for error here.
2. More efficient data reporting and budgeting
As these payroll amounts can be combined into the budgets, it will better show overtime or over budget figures giving managers the information efficiently to quickly make appropriate decisions.
3. Confidently track Changing Tax Rates
As mentioned already, the point at which your employees are earning enough to pay tax in one particular bracket can change regularly – especially for those at the lower end of the tax scale.
4. Have the ability to maintain one central source for all employee data to create ease when completing P60s or other forms.
QuickBooks makes the actual data entry for these forms flawless.
5. Better job tracking, billing and matching hours to jobs when applicable
As a business owner, understanding what jobs are most profitable and why is essential to growing your business. Having all your data in one system allows for complimentary reporting so you can drill down and see what items are affecting the bottom line.
6. Ensure your tax tables are always up to date
An automated system with regular scheduled updates can keep you in safe waters when deducting, making sure your system has received the correct numbers.
There are many companies that can offer to do this job for you but an integrated system with your current QuickBooks is the only way to ensure data integrity and consistency.
As a teacher of QuickBooks and business startup consultant, a fully integrated accounting system that manages all aspects of the business from bookkeeping to inventory management to payroll is the only way to ensure maximum time management, reliability and accuracy. Gone are the days of sweating over mile long spreadsheets and manual calculations and reconciliations. We’re in a technological world, so be a part of it!