What expense category does payroll processing come under?
Payroll processing can come under a few different expense categories, depending on how your business is structured and what type of payroll service you use. The most common categories are:
Wages and Salaries
If you have employees, then their wages and salaries will be processed through payroll. This will include any bonuses, commissions, or other compensation that is paid out through payroll. The total amount of these wages and salaries will be deducted from your business's profits.
Payroll taxes are taxes that are withheld from your employees' wages and salaries. These taxes include federal and state income taxes, Social Security taxes, and Medicare taxes. The total amount of these taxes will be deducted from your business's profits.
If you use a payroll service, then the cost of that service will be deducted from your business's profits. Payroll services can include online payroll services, software, and support from a payroll specialist. The cost of these services will vary depending on the features you need and the size of your business.