Payrolls are one of the most important functions of the organization. It’s important since it governs the qualitative aspect of the productivity that the organization has in terms of employment practices that are governing the operations of the organization. Payroll processing services are the extensions of the payroll department that the organization appoints to manage the payrolls of the employees. Following are generalized steps that are involved in the payroll processing.
- Getting the information
Before the payrolls are administered, all the employees are listed down with their particulars. Attrition is a dynamic attribute to any organization. Employees come and go, and that is why the list has to be refreshed every month to monitor that aspect of the organization. Payroll processing services help the organization in this time taking task.
- Reviewing the timesheet
The time sheet and the respective variables that signify the salary standard are calculated and reviewed, verified and confirmed for further processing.
- Calculate the gross amount
The gross amount is extracted by the payroll processing service by applying the hourly rate over the number of hours worked.
- Checking previous payroll
Previous payrolls are reviewed to find out the amount of arrears, if any, so they cn be cleared out in the current payroll.
- Calculating deductions and additions
Deduction and additions regarding various benefit programs and dock time is calculated and applied for the true salary amount that has to be considered.
- Calculating net after tax
Once the payroll processing service confirms the amount after the respective deductions and additions, tax rate is applied and deducted from the gross pay and subsequently the net amount is ready to be deposited in the employee account.