Payroll and tax management are some of the most exhausting and time-consuming tasks for business owners. And the worst part is you have no room for errors. You have to stick to the laws of the jurisdiction you operate in, or else you risk paying hefty penalties or other severe consequences.
That said, tax management becomes even more complicated when you are in a new market. The laws of a new country will likely vary from your own, which means the risk of non-compliance without even knowing it is even higher.
This is where a global PEO service comes in. It takes care of the nitty-gritty details of your tax management so that you can concentrate on operating and expanding your business in the lucrative global space. But how exactly?
Here is how a PEO service can help your business with global taxes:
Computing Your Payroll Taxes
One of the most important aspects of tax compliance is making accurate tax computations. Underreporting your taxes can lead to legal penalties, which vary with the offense’s severity while over-reporting usually costs you money.
A PEO service handles the calculation of your workforce taxes on your behalf, including federal, state, and local taxes. So, you can be sure you are paying what you rightfully owe the government.
Preparing and Filing Tax Returns
Tax preparation is no doubt cumbersome, more so because of all the paperwork and procedure involved. A global PEO service prepares and files your tax documents and ensures you meet all the legal requirements and filing deadlines.
Since your PEO company typically has the knowledge and experience with the laws of the country you operate in, you can be sure the book will do everything. So, you save costs and time while giving yourself peace of mind without really having to learn how to maneuver the process yourself.
Handling Income & Payroll Tax Withholding
A global PEO company also handles your payroll tax withholding needs. Basically, it will track your worker’s job designation, including any change of status. It will also prepare the required forms for every employee on your payroll.
Perhaps more importantly, it will distribute them to your workers, ensuring everything is done correctly and within good time. So, you save yourself costly errors as well as missing crucial deadlines.
Also Read: A 5-Step International Payroll Set-Up Guide 2023
Manage Wage Garnishments
A global PEO helps your businesses manage wage garnishments in several ways. For starters, it can help you to understand local wage garnishment laws better, allowing you to know exactly what court-ordered deductions your employees need to pay. These could include liens, child support, bankruptcy orders, student loans, and state and federal tax levies.
Moreover, it can effectively process wage garnishments in compliance with local regulations. Global PEO services can also assist in calculating the right amount to be deducted from your workers’ wages upon receipt of wage garnishment orders for employees. This way, the garnishment amounts are correctly calculated and deducted from the workers’ paychecks.
Not to forget, your PEO can calculate the right amount to be deducted from the employee’s wages based on local laws.
Prepare Tax Reports
A Global PEO helps your business prepare up-to-date tax reports, which can be accessible to all stakeholders in real-time. They have all the knowledge of local tax matters, allowing them to prepare reports that meet the requirements of relevant employment laws.
Preparing tax reports entails tons of documentation and effort, and that is where a PEO comes in handy. It takes the work off your hands entirely, taking care of everything from ensuring that all essential info is recorded to document completion and so on. You will not have to worry about mistakes in calculations, missing deadlines, or tax liabilities if you utilize a PEO.
Maintain Tax Compliance
According to studies, about one-third of businesses are fined yearly for payroll mistakes. Constantly changing regulations and complicated local tax laws are some of the factors that might lead to errors in maintaining compliance, but regardless, your business will still have to pay the stipulated fine.
Fortunately, with a global PEO, you can rest assured that your business will always stay ahead of its taxes. Your PEO will always keep up with all changes in tax regulations and endeavor to understand tax laws effectively to ensure that your business adheres to local tax laws in the letter.