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Step by step to create the payroll of your employees

To create a company it is necessary that you not only study the market and develop a proposal of services or products, but also that you give relevance to your potential workers. Therefore, in this article we take the time to explain how to create the payroll of your employees properly. Do you want to know more about it? Continue reading!

What is a payroll?

If you are one of those who are thinking of creating the payroll of your employees soon, first we want you to know what is a payroll? And, in a few words, a payroll is that document that is responsible for indicating the salary that a worker receives from the company, for the activities he/she performs monthly.

In this sense, reference is made to an employee’s salary compensation, taking into account, in turn, social security contributions and personal income tax withholdings.

Likewise, maintaining proper control over your employees’ payroll will be of utmost importance for your business accounting to operate successfully.

Key aspects to be included in the payroll

The process of creating your employees’ payroll is not as complicated as it sounds. However, it is essential that you take into account certain key elements:

Company and employee information

The first thing you must take into account is that, in the upper part of the document you must specify the information that involves both parties in the labor relationship. Then, in the following scheme you will be able to detail the information that you need to put:

In relation to the contribution group to which reference is made, it is important to specify this information, since it will help you to establish the limits of the employee’s contribution base. Likewise, it is also relevant that you clarify the dates of the month to be paid together with the total number of days worked.

 

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2. Accruals

Now, accruals are the income received by the employee. Therefore, this section includes the gross salary, that is to say, all the salary aspects that the employee has generated during the month, as well as those that have not yet been deducted.

In this sense, in the payroll payments you must include salary and non-wage payments.

Salary payments

We understand by salary perceptions the total economic income received by the worker, either in cash, in kind, or any additional bonus offered to him/her. To do so, it is necessary that you take into account the following questions:

What is the base salary?

It is the amount of money that the employee receives for the work performed during the days worked, and should not be less than the established agreement.

What are the salary supplements?

As the name indicates, these are additional supplements to the base salary. That is to say, it can be a bonus received by the employee for certain objectives achieved, an agreement bonus or a seniority bonus, among others.

Do you apply overtime?

In the event of overtime, it is necessary to record it in the employee’s paycheck and pay for the work performed during that time.

Are overtime hours applicable?

Unlike overtime, supplementary hours generally apply when the employment relationship is subject to a part-time contract and the hours stipulated in the contract are exceeded, resulting in an additional payment to the employee.

 Are there extraordinary bonuses?

This category includes extra payments previously stipulated by the company, such as the amount of money given by some companies at Christmas.

Is there a salary in kind?

Offering salary in kind must also be recorded in the payroll. This concept is understood as those attributes that the worker receives from the company that are not granted precisely as money. Among the most common are health insurance, transportation facilities or restaurant cards.

Non-salary payments

On the other hand, non-wage payments are not subject to social security contributions and usually include severance payments, suspensions or dismissals, social security benefits, and some type of extra payment to compensate for expenses incurred by the employee during the working day.

 

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3. Deductions

The next step in creating your employees’ payroll is to perform the deductions. To do this, the existing payments are deducted to obtain the employee’s net salary. Thus, the deductions that are usually made are:

Contributions to social security contributions

These contributions involve common contingencies, unemployment, professional training and overtime.

Personal income tax

Personal income tax deductions must be calculated according to the employee’s income and personal situation. However, in the case of workers with partial contracts or contracts of less than one year, a deduction of 2% is applicable.

Labor advances

It will be specified in the payroll only in those companies that advance part of the salary to their employees.

The value of products received in kind

The amount corresponding to accruals in kind must be deducted, taking into account the products or services from which the employee benefits and subtracting their price in the deductions.

 

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To maintain an optimal functioning of your company’s finances and ensure an adequate work environment, we recommend that you pay attention when creating your employees’ payroll. Therefore, in TAS Consulting we offer you our social management service and advise you on any procedure you require.

 

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