Australian Payroll Calculator for Hourly Workers: When you’re working with hourly employees, one of the most important things to look after is calculating their payroll.
It is crucial for every business to accurately calculate employees working hours and their payroll. You are required to be very precise with your calculations and figures since inaccuracy can result in penalties and noncompliance with laws.
Also you need to know accurate employee hours to protect your company from time theft and other such factors.
Moreover, there are many laws covering the payroll calculation in Australia, so there’s no way you can get away with it.
In this article, we will guide you through the entire process of calculating payroll for hourly employees and why it is important. Let’s dig in.
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Why is it Important to be Accurate with Payrolls?
Calculating accurate payrolls is essential for both the employees and the business.
For employees, because you will be strictly punished for underpaying employees and will be at a huge loss for overpaying. So, both ways it’s a destruction for you only.
The most common labour law violation that an employer can be charged for is underpaying employees. You’ll be fined with lots of dollars for underpaying your employees.
Secondly, to conduct a business legally in Australia, it’s very important to meet all the boundaries of the laws and rules. Inaccuracy can lead to a huge damage to your business and company’s reputation.
An accurate payroll makes sure that the employee is being paid correctly and timely. It develops a sense of trust and security among the employees, which can be very beneficial for your business and your revenue.
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How to Calculate your Salary per Hour?
To calculate your salary per hour, you’ll have to perform the following calculations:
- Start off by multiplying your total working hours in a week with the total number of weeks you work in a year. Let’s the most general example:
You work 40 hours per week and you work 52 weeks annually. So that would be:
- 40 (Hours per week) x 52 (weeks per year) = 2080 Hours
That would make it 2080 working hours per year.
- The second step is to divide your annual income by the number of hours you work in a year.
- $70,000 (income per year) / 2080 (hours per year) = $33.65
This will be your wage per hour. We’ve told you the easiest method to calculate your wages in hours.
Knowing how much you are getting paid per hour is essential for employees to know whether they’re being paid fairly or not.
How to Calculate Payroll for Hourly Employees?
Calculating payroll for employees in Australia is just as important as earning profit from your business. Now this process can be done manually as well. But it will be a very time taking process and has more probability of mistakes.
Therefore, automated payroll systems and tools reduce the chances of human errors and noncompliance with the laws.
The Australian payroll calculator calculates all the complexities for you such as deductions, overtime, allowances etc.
The best thing about this tool is that it saves your two most valuable assets – time and money.
You just have to put the required details in the calculator and it will give you the desired result within seconds. A calculation that can take hours and hours manually can be calculated in a snap with the help of this tool, isn’t that impressive?
Moreover, you don’t even need to hire an accountant or consult a tax advisor because this calculator can help you deal with all types of scenarios. Let’s see how to use it:
How to Use the Australian Payroll Calculator for Hourly Workers?
The Australian Payroll calculator is a very easy and simple tool. You don’t necessarily have to be a pro to use this tool. Here’s all that you have to do:
- You have to start by putting the required employee details. Mostly the tools ask about the state they live in. It helps in calculating some local taxes for the employees.
- Next up you have to put the employees pay details. You have to start by choosing the pay type which could either be hourly, weekly or monthly.
- If your employees pay type is hourly, then select hourly and write their wage under
“pay rate” category. Fill in the number of hours they’ve worked for that pay period. If the employee worked for more than 40 hours, that would be covered under the
“ Additional Pay” category. For now, you just have to write 40.
If the employee is salaried, you’ll see two categories that you can fill if applicable:
- Bonus
- Commission
If the employee works on hourly basis, you’ll see the following categories:
- Overtime
- Bonus
- Commission
- Salary
If your employee is subjected to any additional pay, that’s where you have to enter it. If your employee has worked overtime, put the number of hours under the overtime category.
- Next up you have to input your employees tax details. Such as the tax that will be withheld from the employees pay. Employees filing status, additional withholdings or number of allowances, all such details are included. You can take all this information from Form W-4.
- Now to calculate the payroll for that pay period, select “calculate”. There you’ll have your results within seconds.
Wrapping Up
The Australian Payroll Calculator for hourly workers is a flexible and super helpful tool that aids in calculating the hourly payroll for employees. This calculator does your work so effortlessly and accurately within seconds. It makes it all seem so easy.
In this guide, we have explained the entire method to use this calculator step-by-step. You just have to have all the required details and records. The rest is this calculator’s job. It won’t put you in any trouble as it is updated with all the ATO rules regularly.
Sounds easy? Give it a try!
