Payroll management forms one of the most important parts of an organization. It is important that the payroll process is simplified as far as possible. 

• Understanding the Singapore Payroll System:

There are different aspects of the payroll process in Singapore-based companies. Let us take a look at each of them. 

• Pay the wages every month:

The wages of the employees in Singapore should include basic monthly pay with compensation for housing, travel, meals, and retrenchment benefits. The company can pay the employees their wages monthly or bi-monthly. It becomes an offensive act to not pay salaries to the employees. 

• Issue itemized payslips to all the employees:

Every employee should be given an itemized payslip. This payslip should include:

• Pay date
• Basic pay
• Overtime pay rate
• Allowances
• Period of salary
• Deductions, if any. 

This payslip could be paper or a digital copy. An absence of a payslip can cause you to incur fines and penalties. 

• Calculate the annual leave and pay based on the working hours:

In case, an employee works for incompleted hours during his tenure, the pay rate should be calculated based on the contract. This follows that payment is offered for the number of hours he worked for. 

• Overtime payment calculation:

Overtime is defined as the extra hours an employee puts in after the working hours are over. In Singapore, for overtime, the rate is 1.5 to 2 times more compared to the basic work hours. 

• Record employment details:

With an employee still working, the company has to maintain detailed information about the employee. If an employee has left the organization, you have to preserve the records for at least a year. 

• Study all the statutory requirements:

It is mandatory to comply with all the laws and legalities. Apart from CPF, as an employer, your monthly contributions should look like this:

• Skills Development Levy: Grant that you get when you have to upskill your employees. 
• Ethnic funds to uplift the underprivileged people within the ethnic communities. It includes CDAC, ECF, and others. 
• CPF contribution to people falling under National Service. They should be given CPF even during periodic NS training. 
• Monthly taxes for foreign-based employees with work permits. 

• Follow the statutory reporting:

Since 2017, the Inland Revenue Authority of Singapore (IRAS) has been introduced. It implies that employers have to put forward employee incomes electronically by 1st March every year. This applies if the employer has 10 employees or more. 

Additionally, if you have foreign employees, then you have to fill up tax form IR21 before their employment is completed. 

• Define a calendar for payroll:

A payroll calendar helps you see which employees are due to receive their salaries. It also allows you additional planning around payroll processes. You have the option to choose payroll calendars available on the Internet or create a simple Excel sheet in MS Office. 

Tips to look at before calendar creation:

• Align the payroll calendar with regular dates. This way you are guided during the payroll processes that may need more time. 
• Colors should be used to bifurcate the dates according to holidays, deadlines, and other days. 
• The calendars should be given to all the managers and their employees. 

The calendar should include all the fiscal dates. This makes the payment process and other calculations simple.

• Record all the payroll processes:

To manage the payroll process effectively, you should document every detail. With this, it becomes easy to analyze and audit the payroll process and identify the areas for improvement. Find out the right method for payroll calculation and share the method with the employees. This ensures that everyone is aligned with the process. 

Maintain a manual that has the complete list of steps to processing the payroll. It should also include reports and check handling methods. This comes in handy when there is an emergency. 

• Payroll Automation:

There are so many tools available that help you automate payroll management. Select one tool that optimizes payroll functions within your organization. 

The manual way of processing payroll takes up a lot of time. Additionally, there could be errors in the process. With a payroll tool, most of the calculations are automated. This includes tax additions or deductions, payslip generation, following the laws, tax returns, and more. 

• Outsource the management of payroll:

There are so many tasks within an organization including payroll processing and management. To remove the extra hassle, you always have the option to outsource the payroll management. Bestar accounting services helps you with all the payroll processing within your company. 

Our team takes care of all the minute details that go into payroll processing. 

Conclusion:

Bestar services is a Singapore-based accounting service provider. We have a significant amount of experience in payroll calculation and its management, contact us now.