Hiring your first employee: a payroll checklist

Identify what must be set up

Before running payroll, identify the employer, employees, province of employment, pay frequency and arrangements for benefits or variable pay. The CRA payroll guidance brings together registration, calculation, remittance and reporting topics. Use the official sources to check the obligations that apply.

Do not assume that an accounting software subscription establishes every account or approval you need. Confirm what is covered by the provider and what remains with the employer.

Make responsibilities explicit

Set out who provides hours and changes, who reviews the pay run, who approves it and who ensures funds are available. Record the cut-off time for changes. A reliable process includes a way to correct an error rather than hoping one will never happen.

Employees’ personal and banking information needs an appropriate secure collection method. Do not put that information into an ordinary website contact form when asking about payroll services.

Keep records connected

Payroll reports should connect to the bookkeeping records and the employer’s tax-account information. Discuss how benefits, reimbursements and adjustments will be documented. The team should know which record is authoritative when two systems disagree.

Plan beyond the first payment

Recurring remittances, information slips and changes during the year require attention too. Ask how the provider handles employee changes, year-end reporting and questions about the account. Outsourcing administration does not remove the employer’s responsibility for accurate information and applicable obligations.