29-Oct-2021
Let's face the fact that employees work for
their wages. Timely and accurate wage payment is the most critical part of an
organisation as it motivates people and also reflects positively on the
company. However, it is not an easy task for an SME to correctly calculate the
salaries as it requires a number of computations - income tax, professional tax
& provident fund deductions, HRA and other allowances. Then there is a
multitude of statutory compliances which needs to be adhered to as per the
timelines.
For small and medium enterprises (SMEs), this
could be a little overwhelming. This short guide is intended to help SMEs
manage their payroll effectively on a tight budget.
How to Manage Payroll for SMEs?
Well, to be honest, there is no shortcut if you
wish to handle your payroll on your own. You will need to follow the basic
steps in order to correctly calculate and disburse the salaries on time.
1. Figure out the gross salaries
The first step is the obvious one - you need to
mention the gross salary of your employees (the amount you owe without
deductions) in the excel sheet (if that is what you are using till now!)
For daily wagers, who work on hourly wages,
multiply the total hours worked by the hourly wages. For regular employees,
figure out the attendance against the leaves availed (if any) to arrive at the
number of days they need to be paid for.
2. Deductions
You will need to deduct all the statutory
deductions correctly as per the latest laws. Also, you can deduct any advances
or unauthorized leaves at this step.
3. Payments
It is time you release the payments of your
employees. If you are a very small team, you could either pay via cheque or use
the direct bank transfer mode.
4. Deposit statutory payments to
respective departments
All registered SMEs are required to deposit
taxes to the respective government departments on time. In case of delay or
default, you might have to bear heavy penalties. So, this step is extremely
important where you will have to correctly deposit taxes to the government as
per the deadlines.
Conclusion
If this sounds too complex to you, you might
want to hire the right payroll agency that is capable of
delivering customized solutions for your SME. Weavings is a top-notch staffing agency in India which is known for delivering exceptional staffing and payroll
services in India.
When it is the question of managing payroll,
you have got to rely on the best staffing agency in India. Feel free to get in
touch with our specialists today!