Streamlining Payroll in Xero: Tips for Tradies Managing a Team

“Payroll got you in a tangle? We’ll have it sorted quicker than your shout at the pub!"

Are you a tradie tired of the hassle of managing payroll for your team? Mate, this guide is for you.

Xero makes paying your crew, tracking super, and staying compliant with the ATO straightforward and stress-free.

Payroll might feel overwhelming, but this step-by-step tutorial will help you handle it like a pro.

Managing payroll for your team doesn’t have to be complicated or time-consuming. With Xero’s payroll features, you can easily handle everything from setting up employees to processing pay runs. This guide will walk you through the steps to streamline your payroll and ensure compliance with Australian regulations.

Step 1: Set Up Payroll in Xero

1. Go to the Payroll Settings:

   • Navigate to Payroll > Settings from the main menu.

2. Add Your Business Information:

   • Enter your ABN, legal trading name, and address.

   • Set up your default pay calendar (e.g., weekly, fortnightly).

3. Link Your Bank Account:

   • Ensure your business bank account is connected for payroll payments.

Step 2: Add Employees to Payroll

1. Go to Employees Tab:

   • Navigate to Payroll > Employees and click “Add Employee.”

2. Enter Employee Details:

   • Include name, contact information, and start date.

   • Add their TFN (Tax File Number) and superannuation fund details.

3. Set Pay Rates:

   • Specify hourly rates, overtime, and allowances as required.

Step 3: Process a Pay Run

1. Create a Pay Run:

   • Navigate to Payroll > Pay Runs and click “New Pay Run.”

2. Select the Pay Period:

   • Choose the correct pay calendar and date range for the run.

3. Review and Approve:

   • Check timesheets, leave balances, and deductions.

   • Approve the pay run when all details are accurate.

Step 4: File STP (Single Touch Payroll) with the ATO

1. Enable STP in Xero:

   • Go to Payroll Settings > Single Touch Payroll and enable STP reporting.

2. Submit Payroll Data:

   • After approving a pay run, click “File with the ATO.”

   • Follow prompts to complete the STP submission.

Step 5: Pay Your Employees

1. Generate a Payment File:

   • Export the ABA (Australian Banking Association) file for the pay run.

2. Upload to Your Bank:

   • Log in to your online banking platform and upload the ABA file to process payments.

Step 6: Review Payroll Reports

1. Access Payroll Reports:

   • Go to Payroll > Reports for insights on pay runs, leave balances, and superannuation contributions.

2. Use Reports to Plan Ahead:

   • Track payroll costs and ensure compliance with obligations like superannuation payments.

Pro Tips for Tradies:

• Automate Super Payments: Use Xero’s superannuation feature to streamline contributions.

• Keep Employee Records Updated: Ensure TFNs, super funds, and pay rates are accurate.

• Set Reminders for Payroll Deadlines: Avoid late payments and ATO penalties by staying on top of pay dates.

Conclusion

Streamlining payroll in Xero saves time and ensures compliance, letting you focus on running your trade business. Need a hand setting up payroll? Contact Contigo Accounting today for expert support.

Checklist: Streamlining Payroll in Xero for Tradies

Use this checklist to keep your GST and BAS management in Xero straightforward and stress-free!

• Log in to Xero and navigate to Payroll > Settings to add your business details, ABN, and default pay calendar.

• Link your business bank account to ensure seamless payroll payments.

• Add employees by going to Payroll > Employees, then enter their details, including TFN, super fund, and pay rates.

• Create a new pay run in Payroll > Pay Runs, select the correct pay period, and review timesheets, leave balances, and deductions.

• Enable Single Touch Payroll (STP) in Xero’s Payroll Settings and submit payroll data directly to the ATO after approving a pay run.

• Export the ABA file for the pay run and upload it to your bank to process employee payments.

• Review payroll reports under Payroll > Reports to monitor costs, leave balances, and superannuation contributions.

• Set reminders for pay run dates and compliance deadlines to stay on track and avoid penalties.