We get it, running payroll in an SME can feel like you’re lost in a labyrinth—one wrong turn and you’re facing compliance issues, financial losses, and unhappy employees. To add fuel to the fire you might be navigating complex shift patterns, salaried and contracted employees, and seasonal workers. Yikes! Our recent study on ‘The Power of Automated Payroll’ found that on average, UK payroll providers only automate 31-50% of their payroll services, and 74% of those who aren’t said they were spending anywhere up to 5 days on a payroll run. That’s 480 hours a year – Blimey! Don’t fret, we’ve pulled together this quick and simple guide to help SME leaders to identify the most common payroll errors, so you can approach month end with ease, and manage to get out the door before 8 pm on a Friday.

Why automation is essential for SMEs

Sadly, payroll errors are often more than just minor hiccups; and can lead to significant financial and legal consequences. From incorrect employee classification to missing deadlines, each mistake can snowball into larger issues that at the very least are headache-inducing. To help you get ahead of the game, we’ll dive into these common pitfalls and provide actionable solutions to keep your processes smooth and mistake-free.

We’ll cover the most common payroll mistakes made by SMEs including:

Inaccurate employee classification

Learn how to correctly classify employees, from independent contractors to salaried workers, to avoid head wrecks and costly penalties – and provide a smoother payroll experience.

Missing payroll deadlines

Accurate and on-time employee pay is one of the cornerstones of building trust with your team. Discover the key to ensuring timely payroll processing every cycle, and put an end to payroll complaints from frustrated employees every month.

Incorrect tax calculations

Understand the importance of accurate tax calculations within a pay period, and how to achieve them to avoid any surprise penalties for withholding tax – oops.

Neglecting due diligence

Find out how proper record-keeping and payroll software can save you from compliance nightmares by ensuring correct pay and accurate employee data every time.

Getting up to speed on regulatory changes

Employment law can change multiple times a year. Stay ahead with automatic updates to your payroll system and ensure hassle-free compliance with automated payroll records.

Miscalculating overtime pay

Manually calculating overtime is tedious for any payroll professional or SME. Learn how to correctly calculate overtime, how to avoid missed payments, and how to ensure your team is paid their overtime correctly, every time.

Overlooking payroll deductions

Overpaying or underpaying employees not only means an incorrect paycheck but also means timely payroll mistakes and extra hours of overtime that you’ll spend correcting errors. A huge 64% of all respondents to our recent report said they were taking between 3-10 hours to troubleshoot these errors. Automated software prevents mistakes while processing payroll and makes sure that you’ll never miss the school run. These are just a handful of the payroll mistakes we cover in our no-nonsense guide.

Why download our guide?

This guide, backed by Employment Hero’s expertise, offers practical advice and tools to streamline payroll services. It’s designed to help you avoid the most common payroll errors that SMEs fall into, so you can make sure you are one step ahead of the game and steer clear of pay miscalculations, tax code errors, or overtime payment errors.

Reduce payroll errors with Employment Hero

It’s clear that payroll errors can have a negative impact on your business, but for business owners and HR professionals, it’s impossible to do it all! This is where intelligent payroll software can come in handy. Employment Hero is the world’s first Employment OS (operating system) and can help your business with far more than just managing payroll! One system. Everything employment. To see how we can support your business, talk to one of our specialists.