A payroll report is a document generated from accounting records that outlines the employer’s tax liabilities for internal purposes or to notify the IRS (or another government agency).
These reports summarize all payroll information and are helpful as a way to cross-check financial data collected from employee timesheets, tax forms, pay stubs and other documents.
Payroll reports contain a significant amount of information, including:
- Hours worked
- Employees’ pay rates
- Overtime accrued by employees
- Taxes withheld from employee wages
- Vacation benefit allowances
- Perk management
- Employer tax contributions
Payroll report analysis can provide useful insight to help a company know where they are in terms of paying employees and how to manage it going forward.
Types of payroll reports
There are several types of payroll reports, each containing different information relevant to the employer. Here are some of the most common ones, though many businesses customize reporting to fit their specific metrics and goals.
Payroll summary report
Completed by payroll administrators, this report shows the payment information for a single employee or department within the company for a set date range. It typically includes the following information:
- Tax withholdings for FICA (social security taxes and medicare tax), federal payroll taxes, FUTA tax, federal unemployment tax, etc.
- Gross and net pay the employee receives
Payroll detail report
This report provides more in-depth, granular information about an employee’s compensation history. It may also be used for organization or department-level data.
Payroll tax liability reports
This type of report provides specific information about the taxes withheld from employee wages. This includes how much the employer has paid to government agencies and what the employer still owes. The payroll tax liability report contains information from employee tax forms such as Form W-2 and Form W-3.
Employee summaries
This payroll report outlines personal information for the employee, such as name, date of hire, hourly rate or salary, tax information, and other data.
Retirement contributions
This payroll report breaks down the specific payments made to a retirement plan for employees, including 401(k) and 403(b) plans. This includes both employer and employee contributions.
Paid time off
PTO is another type of report that breaks down the year-to-date and balance of employee time off.
Workers’ compensation
This type of report provides information that can help insurance carriers determine workers’ compensation insurance premiums, including various rates for the amount spent on payroll.
Payroll service charges
This report showcases the amount of money the company is paying for the services of a payroll provider they are using.
What’s the purpose of payroll reports?
While small business owners may view a payroll report like this as an additional task on their plate, there are various benefits to using such reports. In some cases, it’s even required by law. The IRS or Social Security Administration needs payroll information to verify compliance with all requirements, so you’re in obligation to submit the quarterly payroll report known as Form 941, or Employer’s Quarterly Federal Tax Return.
Monitoring payroll reports and other payroll data enables companies to better understand how much they are paying per pay period or what the payroll process costs them, and improve their payroll operations.
Payroll reports can also be helpful to the employees, assisting them in filing their state income and federal income taxes and local government taxes for employees who need these for tax reports.
You can use payroll reports to help ensure payroll is error-free, especially when a business is doing payroll through Excel spreadsheets or templates they need to populate manually. Most payroll software comes with a native functionality of generating payroll reports automatically.
How to create payroll reports
The process of creating quarterly or annual payroll reports depends on whether you rely on automation to run payroll or do it manually. Most automated payroll systems allow you to use templates and create payroll reports in just a few clicks, pulling the data from your employee database and payroll records.
Dedicate a specific time in the month or quarter to focus on creating and analyzing payroll reports, depending on their purpose. For example, if you want to analyze your budget and payroll expenses, quarterly reports are a good choice. If you need to verify tax statements and end-of-year tax forms before tax filing due dates, you will need annual reports.
Keep a list of all the information you need to collect for each report so you can just cross off items as you create reports. You will save time during every reporting period.
Let Deel offer guidance
Smooth payroll is possible even when you have a global team. Deel ensures accurate and fast payments all over the world, compliant with local laws and tax requirements, in multiple currencies, including crypto. We also provide detailed reporting options so you can stay on top of your payroll efficiency at all times. Want to know more? Book a demo with our team and ask away.
