Avoid Payroll Reporting Errors
Payroll drives the reporting of an employees’ remuneration. If errors are made in the reporting of compensation, tax withholding is off and payroll is incorrect. Mistakes can jeopardize both the employee and the employer.
For the employee, incorrect reporting of compensation elements can lead to the misstatement of payroll and required payroll taxes, which in turn can delay the filing of the employees’ tax returns, and can cause penalties and interest.
From the employer’s perspective, employee’s confidence of the payroll process can be compromised, the correction of errors can necessitate the costly running of W-2Cs, payroll penalties and interest and budgeting issues, to name a few.
The global compensation collection and reporting process is complex with more areas for concern and increased room for errors as two or more country tax jurisdictions have to be considered.
Under-reporting of taxable assignment benefits and allowances in either the home of host country, or omitting the reporting imputed personal tax benefits are common errors.
The double counting of compensation and taxable benefits are also common errors, and again costly to both the employee and employer.
The collection of data for compliance purposes typically involves within an organization, the finance, accounts payable, travel and expense, legal, payroll (both home and host) and IT.
Outside the organization, there are external vendors that are often involved including relocation management companies, tax services providers, home and host tax teams, mobility technology companies, payroll providers, etc.
With all of these involved in the process, it is easy to see why this very important process can become overwhelming, frustrating and stressful.
All the moving parts and bottlenecks lead to the processes of collecting, auditing and reporting becoming so much more complicated. It leaves mobility managers wondering what can be done to reduce the noise and smooth the flow.
How We Can Help
While every program is unique, there are best practices to leverage that can minimize the stress. We will consult on best practices on the process and flow of collecting and reporting compensation. Again, our approach is flexible.
We can supplement the process or you can fully outsource the process to Adaptapay.
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100% fully outsourced
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Compensation collection and reporting project manager.
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We can identify the best processes and flow, facilitate the communication between parties who touch the process, establish milestones and keep on track.
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Review of global compensation reporting to identify errors and omissions prior to the W-2 reporting process. This can be done on a monthly, quarterly or annual basis.
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Work with home and host tax jurisdictions to identify proper reporting of remuneration and tax withholding requirements.
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Identify process improvements in the collection and reporting process
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Calculation of tax gross-ups in home and host locations