Ways to pay
One question that’s often asked when starting out is:
How am I going to pay the people that work for me?
Aside from collecting payments, paying your teams their dues for good work is the second most important thing when it comes to keeping your business running smoothly. To accomplish this, you need an easy and reliable way to ensure your techs are routinely paid.
With a number of options available, what’s the best option for your type of business and for the people that work for you?
Here are 5 options to consider:
#1. Google Wallet
Great for instant transfers, free and convenient. If you’re sending more than $500 in one transfer, they’ll ask for verification from the recipient. However, the recipient will receive it in their account almost immediately.
Best Use: Great for emergency situations since it’s instant. Also good for paying contractors as you can track transactions right in Google Wallet. It may not be right for employees as there are a different set of rules in terms of taxes. Regardless of who you use it for, make sure you track all of your transactions for tax purposes.
#2. Bank Check
Many banks now offer free check services that will mail checks to your contractors. They take longer to process, but are simple to execute. These services may charge you after a certain number of checks, but they’re still an affordable option.
Again, these services don’t help when it comes to payroll taxes, but they do give you a paper trail when it’s time to do your taxes.
Best Use: when working with a few contractors and you’re on a budget.
If you’re working with contractors, Payable is an easy way to pay your contractors while ensuring that your books are in order. Add your teams, connect your account, fill out your tax forms and pay your teams. Payable makes it easy to manage all of that quickly.
Best Use: For companies with contractors who want to keep their books impeccable, while keeping payment simple. Also recommended for companies with a larger numbers of contractors.
If you have employees and want a simple way to pay them while ensuring taxes and other benefits are taken care of, Gusto is for you. Your employees can onboard themselves (which gives them greater privacy) and payroll is automated. You can also get worker’s comp through Gusto and everything’s automatically debited. Taxes and tax forms are taken care of, and employees get their W2s sent to them at tax time.
Best Use: For employers who have employees (note, it doesn’t work for contractors) and want a seamless way to handle payroll and even add worker’s comp and benefits all on one platform.
#5. Cash (the last ditch effort)
While not recommended for accounting purposes, paying cash is quick and easy and probably a method your contractors would love.
Best Use: Its best used for emergency situations or for paying your hires for their first jobs until they are officially part of the company and placed on payroll. If you can however, avoid this method. As Brianna Bond, accountant at Ledger says “this usually ends up being a nightmare for your accountant” only use as your last ditch effort.