Payroll records (definition)
Payroll records are documents containing information on each employee’s compensation, including how that pay was calculated.
The information recorded usually includes:
- pay rates and hours worked
- paid time off
- benefits such as employer contributions to retirement funds
- deductions such as tax, insurance and personal retirement contributions
- take-home pay plus details on when and where the payments were made.
- employee tax details, such as their tax code
Payroll records may be kept in paper or electronic form. They may also be called paycheck records.
The information required in payroll records may differ in each country so you should check with HMRC when setting up payroll records. Payroll records can be audited or checked by these authorities so, if there are any problems with your employees’ details or pay, you may be subject to penalties. These authorities will also have information on how long to keep payroll records.
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Disclaimer: This glossary is for small business owners. The definitions are written with their requirements in mind. More detailed definitions can be found in accounting textbooks or from an accounting professional. Xero does not provide accounting, tax, business or legal advice.