For many years small business owners simply wrote their employees a paycheck directly out of the main company checkbook. Some companies went so far as to have a separate account that was used for payroll to help make accounting much easier at tax time. You will find that very few employees will be satisfied with this today as they want to see written proof of exactly how much they have earned and what deductions have been made. If you want to generate the right type of pay stub for your employees, you are going to need the right software.
Why Does Everyone Want a Pay Stub?
This is an excellent question and you cannot help but wonder why after decades of handwritten checks do employees suddenly want you to generate a complete and accurate pay stub? In most cases the simple fact is that they want to be able to track their earnings. Most employers are very honest in the way the pay their employees, those that are not tend to end up going out of business or spending time in prison. However a payroll stub is the employee’s only real way of keeping an eye on his income.
It was easy for an employee to track his money when the only deductions were federal taxes and social security, today however there are so many state, city and local taxes along with personal deductions such as 401K retirement funds, medical and dental insurance and a wealth of miscellaneous deductions that employees want to know how their gross pay shrank by as much as 30% or more before they got what was left.
What Do I Need to Generate the Right Type of Pay Stub?
Now that you understand the importance of being able to provide each of your employees including yourself with a pay stub, the next question is how to create a payroll stub. You could of course write each person a pay stub by hand, but if you have more than one employee, not including yourself, this can quickly become a major hassle. You may also find that many banks and loan companies will not accept a hand written pay slip.