Payroll for Small Employers
Many Brandon employers have fewer than ten employees, and many are hiring for the first time. A first hire brings an employer identification number, federal deposits, a state reemployment assistance account, new-hire reporting and workers' compensation insurance. South Dakota has no state income tax withholding, which keeps payroll simpler than in Minnesota or Iowa, but the federal rules are the same. BOMCAS runs payroll for Brandon employers remotely.
Statewide registration and reporting are on the South Dakota payroll page; this page deals with first hires, student workers and commissions in Brandon.
Your First Employee
- Get an employer identification number if you do not have one.
- Register with the South Dakota Department of Labor and Regulation for reemployment assistance.
- Obtain workers' compensation coverage.
- Have the employee complete Forms W-4 and I-9.
- Report the new hire to the state.
- Set up a deposit schedule for federal taxes.
We handle each step and run the first pay period with you.
High School Workers
Brandon Valley High School students work at local restaurants, stores, pools and recreation businesses. Federal rules limit hours for 14- and 15-year-olds on school days and during the school year and bar workers under 18 from hazardous jobs, including driving on public roads in most cases and using certain equipment. We flag minors in payroll so schedules can be checked.
Tipped Staff and Commissions
Restaurants need tips reported each pay period and overtime figured on the full minimum wage. Salons and studios that pay commissions must make sure commissioned staff earn at least the minimum wage for all hours worked, with overtime figured on total pay including commissions. Booth renters are not employees, but the arrangement must be genuine, with renters setting their own prices and hours.
Crews and Seasonal Work
Contractors and landscapers often add workers in spring and reduce in winter. Seasonal staff are covered by unemployment insurance, and frequent layoffs can affect the employer's rate. Crews working on jobs across the Minnesota line may trigger Minnesota withholding for the days worked there.
Employees Living in Minnesota or Iowa
Employees who live in Minnesota or Iowa but work in Brandon have no South Dakota withholding. Their home state taxes their wages, and some employers offer voluntary withholding for the home state to help them avoid a large balance at filing time, which requires registering with that state.
Paying Yourself
Owners of S corporations must pay themselves a reasonable salary through payroll before taking distributions. Sole proprietors and partners do not run payroll for themselves; they pay self-employment tax on their returns. We help you choose and set up the right approach.
What We Handle
- Pay runs, direct deposit and pay stubs.
- Federal deposits and Forms 941 and 940.
- State reemployment assistance reports.
- New-hire reporting.
- Minnesota or Iowa withholding when required.
- W-2s and 1099s at year-end.
Benefits and Deductions
As small employers grow, they add health insurance, retirement plans and other benefits. Pre-tax deductions for health premiums, HSAs and 401(k) contributions reduce taxable wages, and each must be set up correctly so W-2s are accurate. Small employers may qualify for the small business health care credit in some cases.
Year-End
We reconcile quarterly returns to annual totals, prepare W-2s and 1099s and file them by January 31.
Workers' Compensation Audits
Insurers base workers' compensation premiums on payroll by job class and audit it each year. Payroll reports that separate office staff from field crews and match the quarterly returns make the audit faster and keep premiums from being overcharged.
For very small employers, we can also handle annual filing if the IRS has placed the business on the Form 944 annual schedule, which reduces paperwork.
Brandon Payroll Questions
What do I need before my first employee starts?
An EIN, a state reemployment assistance account, workers' compensation, and Forms W-4 and I-9 from the employee.
Do I withhold Minnesota tax for an employee who lives there?
Not for work done in South Dakota. You can offer voluntary withholding if you register with Minnesota.
Is a booth renter my employee?
Not if the arrangement is genuine. If you control their hours and prices, they may be an employee.
Can high school students work on school nights?
Yes, within federal hour limits for 14- and 15-year-olds.
Talk to BOMCAS About Payroll in Brandon
Payroll posts to the ledger, wages appear on the business return, owner salary is part of planning, missed deposits go through late filing, employees can get help with their own returns, restaurants keep gross receipts tax current, and remote staff in Canada raise cross-border issues. Our statewide South Dakota pages on business tax preparation, personal tax preparation, sales and use tax, bookkeeping, tax planning, back taxes and cross-border tax are linked from the South Dakota overview.
Tell BOMCAS about your Brandon business or household and we will reply with next steps and what we need for a quote. Reach us through the contact page or the form below, at 780-667-5250 or at info@bomcas.ca. All Brandon services are listed on the Brandon overview. This page is general information, not advice for your situation.