Compliance with Tax Laws is Mandatory
Payroll accounting is important because the government mandates that all business owners comply with tax laws. Since compliance is mandatory, employers need to keep up with the federal and state employment tax regulations and procedures.
This includes reporting and depositing payroll taxes to the appropriate agencies in an accurate and timely manner. Late or inaccurate deposits can result in employers having to pay substantial penalties and interest charges. Remember, the laws keep changing with the times so it’s important to keep up-to-date.
It is best business practice to be responsible with your payroll accounting. It involves many different parts of business management including
- Record Keeping
- W-2 taxable wages
- Year-end payments
- Record keeping
- Paycheck distribution and so much more