In a world where everything is provided for us, there would be no need to go out and work. It sounds rather utopian – kind of like a “Garden of Eden” or “Shangri La” scenario or something similar. As this is generally not the case, it’s like the Snow White song says (and I paraphrase): “I owe, I owe, so off to work I go…”. Since we have to work or earn a living anyway, it would be kind of nice to get paid for it…. right?
For many of us, this means drawing some form of pay. In other words – being on payroll. Now we all know that part of the joy of earning and getting paid money is the joy of paying taxes. Yes, I know, a bit of a downer. Regardless, governments at various levels need the money to function. I won’t get into how efficient they are at managing our tax dollars as they do this. That’s a debate I’m not prepared to have. You’d think they get enough money from value-added taxes like PST and HST. Oh well… The whole business of withholding taxes for government is part of what makes payroll such a challenge.
Managing a payroll is one of the most challenging jobs faced by bookkeepers. Many larger companies have dedicated departments that do nothing but. There are also companies that specialize in providing nothing but payroll services. In the case of us here at Fiscal Performance, payroll is one of the primary functions that we offer our contracted clients. Regardless of who does it, it must be done right and on time.
Consider that for all of us who draw a wage, salary or commission, our pay is what we need to live on. Often, pay is crucial for the very basics of life to go forward. Very few of us have the luxury of working just for the fun of it. We need the money and we need it in a timely fashion. Just to compound the fun for bookkeepers, government also insists on getting their money in a timely fashion. Go figure! What’s more, there are penalties and interest to be paid when they don’t get their money on time.
Okay, so it sounds like it’s only a matter of plugging some numbers into the accounting program and – voila – payroll is taken care of. In its simplest form this is true but there is more. What also needs to be taken into consideration are the myriad rules and regulations with regards to:
- Tax tables and remaining with the most current editions
- CPP (Canada Pension Plan)
- EI (Employment Insurance)
- WSIB (Workplace Safety and Insurance Board)
- Union and like dues where applicable
- Additional withholdings
- Payroll differences for wages, salaries, commissions
- Taxation on bonuses and company perks
- Vacation allowances and payouts
- Statutory holiday payouts
- Garnishment procedures
- T4’s, T4 Summaries and similar reporting forms
- Records of Employment for departing staff
- Proper remitting of monies to various levels of government
Just to make it more interesting, all of the above must be done correctly. People depend on this and so does government. It’s like the old saying “ignorance of the law is no excuse”. Anyone involved with payroll needs to stay on top of their game – and the rules and regulations. One of the biggest challenges is that things are always changing. Kind of make you want to go out and hug your bookkeeper or payroll person the next time you see him or her – right?
Here at Fiscal Performance, we are keenly aware of the importance of payroll and we strive to get it right – on time and every time. We thank our many clients for entrusting us with this most important task. If it sounds like this could be something that would be of use for your business, I would be most happy to meet and discuss this with you.
In the mean time…” it’s off to work we go”…