Every business owner is looking forward to cut down on the expenses when running the business. Creating pay stubs for your employees is one of the methods you can apply. Many people who run small businesses do not give pay stubs to their employees and you do not need to be one of them. This little document is important in the life of an employee since he or she can use it to acquire loans or purchasing a home. Making pay stubs is a simple task provided you have the right equipment for this job. You will realize some changes once you begin creating the pay stubs yourself instead of using a third part company. With the help of this article, you will learn how to generate pay stubs for your workers.
The gross income of every employee is the first thing you need to figure out. Gross income usually comes before any necessary deductions are made to the salary. If you have been running your business for several years now, you have a spreadsheet which helps you identify how much you pay your employees. It is easy to calculate how much an individual earns since it is given by the rate paid per hour multiplied by the number of hours worked for in a month. Do not forget to add the number of extra hours keyed in by an employee.
There are several deductions that are carried out on the gross income. The law requires for certain deductions to be made by every employee who earn above the minimum wage. Regular taxes, social security funds and health insurance are some of the deductions that are made. To avoid making any mistakes when deducting this figures, you could hire an accountant who will guide you on how the process works. For any future references, you should come up with a system that will help you calculate these deductions automatically.
The net income of an employee is what you get after factoring in the deductions. What the employee receives at the end of the month is the net income. This is the figure that should be seen at the bottom of the pay stub.
Due to the advancement of technology, the internet has made it easier for employers to create pay stubs. You can easily download a pay stub template on the internet and fill in the form so that it can process the pay stub.
With this, all you need to do is run the template with all the data for it to create a complete pay stub. You can be sure that your employees will appreciate receiving pay stubs every month.