The Penalties of Poor Pay and Bill

Complications arise every day in the workplace, whether it through software malfunction or through the mistake of an employee. Out of date software or unqualified personnel could be the reasoning for complications arising and this emphasises the need to invest in employee training and development and in the right software for the company.

Complications with the pay and bill are not uncommon due to ever changing legislation, differentiation with codes and paperwork, and new features that incorporate pension plans and medical aids for example. The penalty for withholding or being late on payroll payment tax can be substantial as the IRS will issue a number of penalties. A payroll penalty usually hits businesses that can least afford them, whether they are a new business or a company with cash flow problems. But there are a number of things that can be done to reduce a payroll tax penalty.

The first thing to take into consideration is to actually contact the IRS and ask whether the penalty can be abated if the underpayment of the payroll tax is the exception, not the rule.  If a business is new and has paid all the other fees then it is more than likely that a miscalculation may have been made. Even if the company has been established a while and has only missed one payment then the company can be credited as they have a good credit history. If a company can prove that the late deposit is an unusual event then the penalty can be abated. Payroll penalty tax is generated by figuring out the multiplied amount of the late payment by a payroll tax penalty percent and that percent is based on the number of days that the company is late. This can prove to be costly if the employee in charge of pay and bill makes a mistake, as if the employer has not designated what payments get applied to what payroll liabilities then the IRS will generate quarterly penalties by applying the earliest payroll tax payments to the earliest payroll tax liabilities So basically, if the payroll payment is made late then the other timely payment are also made late.

Pay and Bill software can eradicate the complexities of payroll and will eliminate the chance of making any mistakes in regards to payment. Pay and Bill software allows you to electronically calculate taxes and deductions precisely. Pay and Bill software also allows a company to calculate salaries, commissions and differentiates department pay.  Software may not be right for your company, as if you have a small company with 10 or so employees then it may be more cost effective to look into payroll outsourcing. Outsourcing the payroll to those that are specialists in the field will eliminate the complexities and worries that pay and bill bring and also enhances company efficiency as the employee that was entrusted with the payroll can utilise their skills on other tasks which may prove to be more worthwhile than investing in payroll software.