What is a payroll report?

In the complex world of business, employee remuneration is essential to get right – and easy to get wrong. A well-made payroll report makes everything simple, ensuring the workforce gets the clarity they deserve, and keeping you on the right side of labour laws and tax regulations. It also provides a vital financial snapshot, capturing essential details about wages, deductions, taxes and more.

Essentially, a payroll report is a document that employers use to verify their tax liabilities or cross-check financial data. It may include such information as pay rates, hours worked, overtime accrued, taxes withheld from wages, employer tax contributions, holiday balances and more.

It can help give a picture of where your business stands – and offer crucial information for future planning.

What is a payroll report?

Different types of payroll report

Payroll reports come in a variety of forms, each designed to fulfil specific purposes. Understanding the different types is crucial if you want to streamline your processes and maintain financial transparency.

  • Payroll summary
    What? – Summarises the total compensation paid to employees during a specific period.
    Why? – Provides an overview of labour costs and aids in budgeting and financial planning.
  • Tax filings
    What? – Contains information about taxes withheld from employees’ wages.
    Why? – Ensures the business meets tax obligations and complies with regulations.
  • Year-to-Date Reports
    What? – Displays cumulative payroll figures from the beginning of the fiscal year.
    Why? – Offers insights into annual payroll trends and helps you make informed financial decisions.
  • Payroll Cost Analysis
    What? – Breaks down payroll costs, including salaries, benefits, and taxes.
    Why? – Facilitates cost control, budget adjustments and strategic decision-making.

How to use payroll reports to run your business

Payroll reports aren’t just about compliance. They can play a pivotal role in the management and growth of your business. When you understand the power of these reports, you can unleash their full potential.

  • Make better decisions
    Armed with valuable insights into workforce costs, you can make informed, data-driven decisions.
  • Make budgets and forecasts
    By analysing payroll summaries and cost breakdowns, you can create accurate budgets and forecasts, which will promote financial stability.
  • Have happier people
    When you communicate payroll information transparently to your workers, you foster trust and improve employee engagement.
  • Avoid risks
    OK, we said it’s not just about compliance, but regularly reviewing tax filings helps you adhere to tax regulations and reduce the risk of penalties or legal issues.

Simplify your report by using payroll software

The emergence of payroll software has been a game-changer. Now every business can achieve efficiency and accuracy in its financial processes. A notable player in this field is ADP, offering automatic reports that simplify the complexities of payroll management.

  • Automatic reports
    ADP’s payroll software streamlines the production of payroll reports, ensuring accuracy and saving you valuable time.
  • Customisation and flexibility
    With ADP’s software you can customise reports so they meet your specific needs, and allow you to present data in a way that suits you.
  • Efficient compliance
    The automated features built into ADP’s software help you stay compliant with ever-changing labour and tax regulations.

What payroll reports do employers need to file?

There main form required as part of payroll reporting is Form 24Q, which must be submitted quarterly and includes details of salary paid to employees and tax deducted at source. Form 24Q consists of 2 annexures – Annexure I and Annexure II. Annexure I must be submitted for all four quarters, while Annexure II only needs to be submitted in the final quarter (Jan-Mar).

The following information must be included in Annexure I:

  • BSR code of branch
  • Date of submission  
  • Serial number
  • Total amount
  • TDS amount to be allocated among deductees
  • Interest amount to be allocated among deductees

The following details of deductee must also be included:

  • Employee reference number (if available)
  • PAN of the employee
  • Name of the employee
  • TDS Section Code
  • Date of payment/credit
  • Amount paid or credited
  • TDS amount
  • Education Cess

Additionally, if the employer hasn’t deducted TDS or has deducted it at a lower rate, they must provide the reasons.

Annexure II consists of a total breakdown of salary, any deductions to be claimed by the employee, their income from other sources, and house property and overall tax liability.

What payroll reports are due annually?

  • Form 12B, which must be provided to an employee who joins during the year. It will include details of their previous employer, including PAN and TAN number, along with salary, deductions and any professional tax paid.
  • Form 16, the certificate of tax deducted at source and must be issued on behalf of employees when tax is deducted

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