Things to know to simplify the payroll process for SMEs

1
things to know to simplify the payroll process
for SMEs
Bestar Services Pte. Ltd
2
things to know to simplify the payroll process
for SMEs

• Payroll management forms one of the most
  important parts of an organization.
• It is important that the payroll process is
  simplified as far as possible.

3
Understanding the Singapore Payroll System
4
Pay the wages every month
5
Issue itemized payslips to all the employees

• Every employee should be given an itemized
  payslip. This payslip should include
• Pay date
• Basic pay
• Overtime pay rate
• Allowances
• Period of salary
• Deductions, if any.
• This payslip could be paper or a digital copy. An
  absence of a payslip can cause you to incur fines
  and penalties.

6
Calculate the annual leave and pay based on the
working hours

• In case, an employee works for incompleted hours
  during his tenure, the pay rate should be
  calculated based on the contract.
• This follows that payment is offered for the
  number of hours he worked for.

7
Overtime payment calculation

• Overtime is defined as the extra hours an
  employee puts in after the working hours are
  over.
• In Singapore, for overtime, the rate is 1.5 to 2
  times more compared to the basic work hours.

8

Record employment details

• With an employee still working, the company has
  to maintain detailed information about the
  employee.
• If an employee has left the organization, you
  have to preserve the records for at least a year.

9

Study all the statutory requirements

• It is mandatory to comply with all the laws and
  legalities. Apart from CPF, as an employer, your
  monthly contributions should look like this
• Skills Development Levy Grant that you get when
  you have to upskill your employees.
• Ethnic funds to uplift the underprivileged people
  within the ethnic communities. It includes CDAC,
  ECF, and others.
• CPF contribution to people falling under National
  Service. They should be given CPF even during
  periodic NS training.
• Monthly taxes for foreign-based employees with
  work permits.

10

Follow the statutory reporting

• Since 2017, the Inland Revenue Authority of
  Singapore (IRAS) has been introduced. It implies
  that employers have to put forward employee
  incomes electronically by 1st March every year.
  This applies if the employer has 10 employees or
  more.
• Additionally, if you have foreign employees, then
  you have to fill up tax form IR21 before their
  employment is completed.

11

Define a calendar for payroll

• A payroll calendar helps you see which employees
  are due to receive their salaries. It also allows
  you additional planning around payroll processes.
  You have the option to choose payroll calendars
  available on the Internet or create a simple
  Excel sheet in MS Office.
• Tips to look at before calendar creation
• Align the payroll calendar with regular dates.
  This way you are guided during the payroll
  processes that may need more time.
• Colors should be used to bifurcate the dates
  according to holidays, deadlines, and other days.
  
• The calendars should be given to all the managers
  and their employees.
• The calendar should include all the fiscal dates.
  This makes the payment process and other
  calculations simple.

12

Record all the payroll processes

• To manage the payroll process effectively, you
  should document every detail. With this, it
  becomes easy to analyze and audit the payroll
  process and identify the areas for improvement.
  Find out the right method for payroll calculation
  and share the method with the employees. This
  ensures that everyone is aligned with the
  process.
• Maintain a manual that has the complete list of
  steps to processing the payroll. It should also
  include reports and check handling methods. This
  comes in handy when there is an emergency.

13

Payroll Automation

• There are so many tools available that help you
  automate payroll management. Select one tool that
  optimizes payroll functions within your
  organization.
• The manual way of processing payroll takes up a
  lot of time. Additionally, there could be errors
  in the process. With a payroll tool, most of the
  calculations are automated. This includes tax
  additions or deductions, payslip generation,
  following the laws, tax returns, and more.

14

Outsource the management of payroll

• There are so many tasks within an organization
  including payroll processing and management. To
  remove the extra hassle, you always have the
  option to outsource the payroll management.
  Bestar accounting services helps you with all the
  payroll processing within your company.
• Our team takes care of all the minute details
  that go into payroll processing.

15

Conclusion

• Bestar services is a Singapore-based accounting
  service provider.
• We have a significant amount of experience in
  payroll calculation and its management, contact
  us now.

16
Follow us