Payroll is often one of the biggest minefields a business has to deal with — and one no employer can avoid — regardless of its size. Between constantly changing laws and regulations, making sure taxes are handled appropriately, and watching out for errors and fraud, payroll administration can be a full-time job and a full-time headache — even at a small organization with only a few employees.
This week’s HR Outsourcing News Roundup brings you articles and blog posts with advice and information on payroll administration.
Payroll Taxes Can Bring IRS To Your Door, Even Land You In Jail. Forbes: “The IRS is especially vigorous in going after payroll taxes withheld from wages that are not promptly paid to the government. This is trust fund money that belongs to the government and was withheld from wages. That makes any failure to pay—or even late payment—much worse. In fact, that’s so regardless of how or why the employer or its principals use the money. Using the money to pay suppliers and keep the business open isn’t a good reason in the IRS view.”
Top 10 Payroll Mistakes Companies Make. Accounting Today: “Whether expense reimbursements can be excluded from an employee’s wages depends on whether he or she is reimbursed pursuant to an accountable plan. An accountable plan is generally one under which expenses are reimbursed only if there is a business connection to the expenditure, there is an adequate accounting of the expenditure and any excess reimbursements are returned to the employer. If expenses are reimbursed under a policy or plan that does not meet these requirements, they must be included in taxable wages.”
How to Detect and Prevent Payroll Fraud. Undercover Recruiter: “Commission workers or employees who work in manufacturing and are paid by how many units they produce can also commit payroll fraud. This is done by falsifying records such as how many sales they have made or units they have produced.”
5 Best Practices for a Successful Payroll System. Software Techniques: “Time theft occurs when employees intentionally mis-record their hours, take overly long breaks, spend work hours on non-work-related activities, or use ‘buddy punching’ to check in when they aren’t present. Implement a check-in system that automatically records an employee’s hours when they sign in or swipe their card. You can further decrease fraud by utilizing biometric sign-in hardware such as a fingerprint scanner.”
Dealing with Payroll Fraud. Business First Magazine: “Much fraudulent activity occurs out of normal office hours and often by remote access to the payroll system. If people in your organisation are regularly accessing the payroll outside business hours, the need for this access may need to be questioned. Alternatively, after hours activity should be audited.”
If you have questions about payroll administration for your organization, contact us. We’re here to help.
HR Solutions is a human resources outsourcing firm based in Baton Rouge, Louisiana. We eliminate human resources headaches for businesses with 10 to 1,000 employees by handling their payroll, employee benefits, regulatory compliance and other staffing needs. Contact us to learn how we can streamline your company’s human resources function to save money and reduce risk.