{"id":6002,"date":"2019-03-01T03:54:01","date_gmt":"2019-03-01T08:54:01","guid":{"rendered":"https:\/\/www.sage.com\/en-us\/blog\/?p=6002"},"modified":"2026-02-12T05:17:30","modified_gmt":"2026-02-12T10:17:30","slug":"error-proof-payroll-process","status":"publish","type":"post","link":"https:\/\/www.sage.com\/en-us\/blog\/error-proof-payroll-process\/","title":{"rendered":"6 ways to error-proof the payroll process for small business owners"},"content":{"rendered":"
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\n\t\t\t\t\t\t\tMoney Matters<\/a>\t\t\t\t\t\t<\/div>\n\t\t\t\t\n\t\t\t\t
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\n\t\t\t\t\t\t6 ways to error-proof the payroll process for small business owners\t\t\t\t\t<\/h1>\n\t\t\t\t<\/div>\n\n\t\t\t\t\t\t\t\t\t

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\n\t\t\t\n\t\t\t\t\"\"\t\t\t\tVirginia Dannelly<\/span>\n\t\t\t<\/a>\n\n\t\t\t\t\t<\/div>\n\n\t\t\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t<\/div>\n<\/div>\n\n\n\n

If the saying \u201cto err is human\u201d is true, then why are so many small business owners relying on manual processes? A Sage research study conducted by FTI Consulting shows U.S. small business owners spend 266 days a year on admin tasks, and 12% of them said payroll tasks account for most of the time they spend on admin.<\/p>\n\n\n\n

The HR function includes many data-driven tasks, which makes it prone to human error. Between manually transferring data and the time needed to verify accuracy, it\u2019s no wonder small business owners are in a crunch. The 2015 IRS Databook shows employer payroll<\/a> tax issues cost U.S. small businesses $6 billion in civil penalties.<\/p>\n\n\n\n

How can small business owners minimize the risk of errors and penalties? It\u2019s easy with today\u2019s cloud-connected solutions that make accuracy, compliance, and employee experience seamless.<\/p>\n\n\n\n

Here are six core areas in human resources management where cloud-connected software removes barriers to accuracy.<\/p>\n\n\n\n

1. Easier onboarding and verification<\/h2>\n\n\n\n

Digitizing the onboarding process reduces challenges with accuracy from the beginning. Using HR software gives you a secure environment to interactively and accurately upload employee information. Beyond that, a cloud-connected solution empowers new hires to upload their own information as an added layer of accuracy. Both employees and managers can confirm that new employees have correctly entered their name, social security number, bank account deposit number, deductions for benefits and 401(k), and have accurately filled out their information on their tax forms.<\/p>\n\n\n\n

Employee self-service software can help you start the process before the new hire\u2019s start date, which makes for a welcoming employee experience. It\u2019s also an early opportunity for your new hire to verify and confirm their information rather than spending the first day filling out forms. The use of e-signature enables you, the employer, to capture requisite information simply.<\/p>\n\n\n\n

A cloud-connected solution also establishes the process for how your new and current employees update life events, changes in address, marital status, and tax deductions. A best practice is to set up quarterly reminders for all employees to confirm that nothing has changed in their employee information. For extra measure, be sure to also keep your employee job descriptions updated as well to protect your business from misclassifying your workers. Don\u2019t be afraid to include employees currently in those roles as part of the job description audit.<\/p>\n\n\n\n

2. Tracking time for hourly employees<\/h2>\n\n\n\n

Having a time tracking software that\u2019s integrated into your payroll management software eliminates the human aspect of payroll management via paper and instead uses a fully automated system for accurate timekeeping and proper documentation to address compliance. As an added bonus, these tools significantly reduce the time spent managing employee schedules, timesheets and payroll from hours to minutes per month.<\/p>\n\n\n\n

3. Have a self-service option for employees<\/h2>\n\n\n\n

Preventing payroll mistakes can be as simple as giving your employees the tools and processes needed to communicate with you and your managers about changes in information, updates in roles and job requirements, and any payroll inaccuracies. A self-service portal is an opportunity to give them access to important documentation 24\/7. It\u2019s also a platform for you to provide FAQs about employee policies and procedures to reduce the time you have to spend addressing those types of concerns.<\/p>\n\n\n\n

While digital payroll and HR solutions greatly reduce human error, no solution is foolproof. If your employees catch payroll discrepancies, have a formal process in place so they can report these issues and more importantly, you can quickly resolve any discrepancies before they become bigger problems (i.e. litigation or penalties). Use an easy and integrated communication form where they can notify you or your managers directly on any timesheet or payroll errors.<\/p>\n\n\n\n

4. Automation everywhere possible<\/h2>\n\n\n\n

As your company continues to build and expand its workforce it\u2019s important to constantly audit your payroll process. The sooner you have a more efficient platform, the sooner you can use its tools to pinpoint any potential discrepancies that could turn costly. For example, an ideal solution offers a comprehensive audit for each quarter versus just year-to-date and current quarter. This gives you an earlier trail on abnormal changes in data so you can investigate and action if needed.<\/p>\n\n\n\n

Leading solutions also offer historical analysis for correct W-2 filings to catch any retroactive discrepancies over time \u2013 another immediate benefit of upgrading to a cloud-connected solution. With a simplified view of all your company\u2019s payroll tax data and pre-configured report generation, payroll becomes a speedy process and the time spent managing and validating data can be spent focusing on your customers.<\/p>\n\n\n\n

If you don\u2019t have a system in place to regularly check for compliance, your organization is vulnerable to discovering inconsistencies after it\u2019s too late. Businesses that implement processes to control compliance are more prepared in case of an audit and can catch costly inconsistencies in advance.<\/p>\n\n\n\n

5. Better end-of-year reporting<\/h2>\n\n\n\n

Sage research shows one-in-three small businesses spend more than 80 hours \u2013 that\u2019s two work weeks \u2013 prepping for tax season<\/a>. Today\u2019s tools use smart learning to automatically record and track the necessary data for your organization\u2019s tax scheme, which makes end-of-year reporting easier to manage.<\/p>\n\n\n\n

An up-to-date payroll service is an opportunity to examine (or re-examine) how accurately you collect and store data. If you\u2019ve ever been charged fines and penalty fees due to miscalculations, starting fresh with a new provider could mean a more detailed review of your existing data and the eventual end to those occurrences. For example, automation within today\u2019s payroll tax software solutions typically includes Form 941 \u2013 Employer\u2019s Quarterly Federal Tax Return. Since data is automatically monitored and updated once you\u2019re an official customer, your quarterly and year-end reports are accurate every time.<\/p>\n\n\n\n

6. Give your business time to grow<\/h2>\n\n\n\n

Do you plan to do any hiring or expansion over the next 60 days? As your business grows, naturally your payroll needs will grow as well. What\u2019s sufficient for your business today may not be once you add more staff or contractors. And if you\u2019ve already identified areas where your provider isn\u2019t efficient as-is, it\u2019s likely your expansion will only intensify the inefficiency.<\/p>\n\n\n\n

The right solution will offer features that support your business goals and can expand at the same speed as your business does. Choose a software designed to make your life easier whether your business has 1, 10 or 100s employees.<\/p>\n\n\n\n

In summary, the right tools can eliminate the challenges you have with managing payroll and all the other tasks required to run your business. With less time spent checking for accuracy and dealing with paperwork, you can get back to delighting your customers.<\/p>\n\n\n\n\n

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If the saying \u201cto err is human\u201d is true, then why are so many small business owners relying on manual processes? A Sage research study conducted by FTI Consulting shows U.S. small business owners spend 266 days a year on admin tasks, and 12% of them said payroll tasks account for most of the time […]<\/p>\n","protected":false},"author":681,"featured_media":3775,"menu_order":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_sage_video":false,"post_featured_image_hide":false,"footnotes":""},"categories":[43],"tags":[17,34],"business_type":[40],"lilypad":[],"context":[],"industry":[411],"persona":[96,97],"imagine_tag":[215],"coauthors":[748],"class_list":["post-6002","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-money-matters","tag-hr-payroll","tag-small-business","business_type-small-business","industry-human-resources"],"sage_meta":{"region":"en-us","author_name":"Virginia Dannelly","featured_image":"https:\/\/www.sage.com\/en-us\/blog\/wp-content\/uploads\/sites\/2\/2018\/03\/payroll.jpg","imagine_tags":{"215":"HR and Payroll"}},"distributor_meta":false,"distributor_terms":false,"distributor_media":false,"distributor_original_site_name":"Sage Advice US","distributor_original_site_url":"https:\/\/www.sage.com\/en-us\/blog","push-errors":false,"_links":{"self":[{"href":"https:\/\/www.sage.com\/en-us\/blog\/api\/wp\/v2\/posts\/6002","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.sage.com\/en-us\/blog\/api\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.sage.com\/en-us\/blog\/api\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.sage.com\/en-us\/blog\/api\/wp\/v2\/users\/681"}],"replies":[{"embeddable":true,"href":"https:\/\/www.sage.com\/en-us\/blog\/api\/wp\/v2\/comments?post=6002"}],"version-history":[{"count":0,"href":"https:\/\/www.sage.com\/en-us\/blog\/api\/wp\/v2\/posts\/6002\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.sage.com\/en-us\/blog\/api\/wp\/v2\/media\/3775"}],"wp:attachment":[{"href":"https:\/\/www.sage.com\/en-us\/blog\/api\/wp\/v2\/media?parent=6002"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.sage.com\/en-us\/blog\/api\/wp\/v2\/categories?post=6002"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.sage.com\/en-us\/blog\/api\/wp\/v2\/tags?post=6002"},{"taxonomy":"business_type","embeddable":true,"href":"https:\/\/www.sage.com\/en-us\/blog\/api\/wp\/v2\/business_type?post=6002"},{"taxonomy":"lilypad","embeddable":true,"href":"https:\/\/www.sage.com\/en-us\/blog\/api\/wp\/v2\/lilypad?post=6002"},{"taxonomy":"context","embeddable":true,"href":"https:\/\/www.sage.com\/en-us\/blog\/api\/wp\/v2\/context?post=6002"},{"taxonomy":"industry","embeddable":true,"href":"https:\/\/www.sage.com\/en-us\/blog\/api\/wp\/v2\/industry?post=6002"},{"taxonomy":"persona","embeddable":true,"href":"https:\/\/www.sage.com\/en-us\/blog\/api\/wp\/v2\/persona?post=6002"},{"taxonomy":"imagine_tag","embeddable":true,"href":"https:\/\/www.sage.com\/en-us\/blog\/api\/wp\/v2\/imagine_tag?post=6002"},{"taxonomy":"author","embeddable":true,"href":"https:\/\/www.sage.com\/en-us\/blog\/api\/wp\/v2\/coauthors?post=6002"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}