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Payroll Report: Definition, How-To & Free Sample Templates

Payroll ReportPayroll Report
min read
August 21, 2023

Managing your business might feel a bit like juggling at times. You have to keep track of the day-to-day operations (like handling sales and customers) and the big-picture things, like growing and making a profit

So, what’s the key to figuring out if you’re making a profit? Knowing how much of your income goes toward expenses. That’s why business owners rely on tools like payroll reports to give them insight into one of their biggest spending categories, labor

Keep reading to learn how to create and analyze payroll reports to improve your business.

What Is a Payroll Report?

Payroll reports are documents that summarize payroll data, like wages, employee hours, and payroll taxes. You can use them for many reasons, like calculating employer taxes, verifying profit calculations, and budgeting to pay your employees.

You may already be familiar with some of the payroll reports that go along with your business taxes, such as Form 944, Employer’s Annual Federal Tax Return and Form W-2, Wage and Tax Statement. We’ll cover these in more detail when we go over the different types of reports you can generate. 

Payroll Report Templates

If you’re manually creating your reports, here are some free templates you can use. These three are some of the most commonly used reports you’ll need to keep your business running and make sure you’re calculating employee pay correctly. 

General Report

The general report template shows line-by-line totals of hours worked, gross pay, deductions, and net pay for all employees paid during a period.

General Payroll Report

Payroll Statement Template

The payroll statement template summarizes employee hours, gross pay, deductions, and net pay for a single employee.

Payroll Statement Template

Timesheet Template

This timesheet template is a summary of employee hours worked and total pay.

Timesheet Template

How To Create a Payroll Report

Let’s go back to the basics now…so how, exactly, do you create a payroll report from scratch? Payroll reports usually come in a spreadsheet or chart format. The information you include depends on how you plan to use the report.

For instance, to figure out how much money you need to pay your team, you may create a spreadsheet with employee hours and their pay rates for the given pay period.  Here are the basic steps to prepare any kind of payroll report:

1. Choose the Time Period for the Report

Payroll reports always summarize information over a period of time, such as a week, month, or year. The first thing you want to do is figure out which dates you’re collecting data from.

If you’re using the report for budgeting purposes, monthly and quarterly reports are most helpful. However, if you’re creating a report to help with year-end tax forms, you’ll need an annual report.

2. Outline the Information You Need to Collect

In this step, you choose the columns of your chart or spreadsheet. You can include any data that’s part of payroll, such as hours worked, employee pay rates, taxes withheld, voluntary deductions, and payroll expenses (such as the employer portions of Social Security and Medicare taxes).

If you’re calculating how much money you need for payroll, your columns might be: 

3. Enter Data in Your Spreadsheet or Generate a Report with Software

Now that you have your time period and data columns, all you have to do is fill in the report. 

Let’s say you want to see how much money you need to run payroll this month. For each employee, create an entry with their total hours, gross pay, taxes withheld, and net pay.

4. Analyze Your Report

Once you’ve filled in all the data, you can analyze it. By analyzing, we mean using your report to answer business questions. 

For instance, a report that includes employee hours and wages can answer questions like: 

The great thing about these reports is that you can also use them to answer several questions about your expenses and budget. 

Here are just a few of the many questions you can find answers to:

The most important thing to remember with creating these reports is to double-check your work and ensure your data is accurate. After all, if you make mistakes on your spreadsheet, you’ll end up analyzing incorrect information. 

Hourly payroll software screenshot‍

If you want to speed up the process and eliminate data entry mistakes, you can use payroll software like Hourly to generate payroll reports. Simply choose the date range and the type of information you want to see and create a report with a click.

Types of Payroll Reports

Now that you know the basics of preparing a payroll report, let’s look at some payroll reports you may come across as a business owner. 

First, we’ll cover the reports you need to submit to the government, and then we’ll dive deeper into the reports you can use to analyze your payroll data internally.

Reports That Employers Need to File

When you hire employees, you take on more tax-related responsibilities like withholding income and paying employer taxes

At the end of the year, you have to let the government know how much you paid employees. The government uses this information to ensure you paid your employees at least a minimum wage and withheld the required payroll taxes

Form 941

Here are the types of payroll-related reports you may need to submit to the IRS.

Reports for Internal Use

Besides the government-required reports, you may also use multiple reports for internal tracking and cross-checking other financial reports, such as your income statement or balance sheet. These can include reports like paid time off (PTO) report and your payroll preview report, which are both examples of a type of payroll report.

Here are some of the common internal reports, along with the payroll information they include:

Payroll Report vs. Pay Statement vs. Payroll Summary

As you run your business, you may hear the terms “pay statement” and “payroll summary.” Are these just other ways of saying payroll report? 

Not exactly. 

Instead, they’re both specific types of payroll reports. Let’s take a look at what each one contains. 

Pay Statement

The pay statement (also known as a wage statement) is a report you give to your employees. It tells them their gross wages, taxes withheld, deductions, and net pay for the current pay period and so far during the year. This information often gets distributed along with pay stubs so employees can track their total earnings.

Payroll Summary

On the other hand, a payroll summary is a snapshot of your total payroll data for a given period. For instance, you can run a payroll summary for the last quarter and see how much wages you paid, taxes you withheld, and voluntary contributions you deducted during that time.

Mastering Payroll Recordkeeping with Software

Payroll records are an excellent tool to have at your disposal. They help you keep track of one of your most significant expenses and ensure you have enough budget to fund employee paychecks. 

Now that you know how they work, all you have to do is open up your accounting software and fill out those templates. Or you can make your life even easier by streamlining your payroll process and opting for software like Hourly that lets you run payroll and generate reports with the click of a button.

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