When payroll isn’t done right, it leads to unhappy employees, compliance risks, and the kind of stress that keeps you up at night.
And if you’re still using spreadsheets or paper records as year-end approaches? That stress level grows fast.
At Rise, we’ve helped thousands of Canadian small businesses simplify payroll and stay compliant. So we’ve created this practical checklist to help you do the same — no jargon, no overwhelm, just clear steps to help you stay organized and confident.
Whether you're handling payroll yourself or working with a service provider, this small business checklist will help you stay compliant and organized.
Table of Contents
Why is a payroll checklist essential for a small business?
Think of the last time you followed a complex recipe. If you miss an ingredient or mix things in the wrong order, the final dish flops (especially if you’re baking).
Payroll is the same — one small mistake can throw off everything from paycheques to tax filings.
Here’s why keeping a payroll checklist matters:
- Small teams often mean fewer hands on deck — and missed deadlines happen. A checklist can help you stay on track.
- Tax laws may change (especially across provinces), so it’s best if you have a master list to triple check.
- Payroll mistakes quickly lead to frustrated employees. A checklist can help you avoid these missteps and keep employees happy and engaged.
Basically, a simple checklist keeps things on track. It’s a safety net, helping you catch problems before they turn into bigger headaches.
Let’s get into the steps you need to take to maintain payroll.
Step 1: Collect accurate employee and business info
Solid payroll starts with solid data. Make sure you have every employee’s:
- Legal name
- Date of birth
- Address
- Social Insurance Number (SIN)
Important to note: it’s mandatory to verify that the SIN is valid, particularly if the employee presents a temporary SIN beginning with ‘9’. As an employer, you’re required to follow up with the employee to ensure a permanent SIN is provided when the temporary one expires.
- Wage or salary info
- Tax details and deductions, including Federal TD1 and the Provincial/Territorial TD1. For Quebec, the TP-1015.3-V is mandatory.
Double-check everything before you add it to your payroll records. Even tiny mistakes — a missing middle initial or wrong SIN — can cause compliance issues later.
It’s also smart to make sure your CRA payroll account and business registrations are up to date.
Pro tip: Create a quick, repeatable process for collecting employee details, work hours, and tax info from day one. Doing the small stuff right now saves big headaches later.
Step 2: Choose payroll software that does the heavy lifting
Payroll software has come a long way. With the right tool, you can automate calculations, file taxes, track time, and even give employees self-service access to their info.
Points to consider when deciding on the payroll tool
- Scalability: Opt for a payroll software that can grow with your business while minimizing the hassle of switching to a new system later. Ask yourself: Will this payroll software grow with you as you add staff, locations, or new pay types?
- Compliance automation: Tax rules change frequently, so your payroll software should automatically recalibrate to reflect the latest tax changes. The right software will handle new tax updates and filing requirements for different provinces or states, without extra work from you. This is where Rise stands out.
- Employee experience: Self-service portals with a seamless mobile interface reduce HR’s administrative burden. With payroll software like Rise, employees can directly access their information, view pay slips, request time off, and review other benefits all on their own.
- Integrations: If you already have an HR, accounting, or time tracking system in place, make sure that the integration helps reduce manual work rather than simply relocating it. Consider if the software will integrate well with your existing HR, accounting, or time-tracking tools.
- Consider the total cost of ownership: When choosing a payroll tool, you should not only consider the subscription cost but also account for expenses related to installation, training time, and whether additional support will be required.
By investing in the right tool now, you’ll save time, reduce risk, and allow your business to scale.
Step 3: Stay on top of taxes and compliance
Canadian payroll taxes can get complicated, especially if you operate in more than one province. It’s important to make sure you’re staying on top of all the CRA updates.
In addition to this, payroll software can help you stay on top of taxes and compliance.
Good payroll software should handle this for you automatically:
- Calculate and withhold the correct taxes (federal and provincial)
- Generate and e-file your forms (T4s, T4As, RL-1s)
- Provide employees with access to their tax and pay slips through self-service portals.
- Ensure compliance with CRA and Revenu Québec requirements by automatically updating form templates and regulatory guidance.
With support from payroll software, you’ll simplify year-end payroll tasks, reduce compliance risk, and save time.
But this step isn’t just about avoiding penalties — it’s also about building trust with your team and staying confidently compliant year-round.
Keep in mind: It is required to have a remittance account with the CRA to stay on top of deadlines to the CRA and Revenu Québec.
Step 4: Make payroll reviews a habit
Set aside time after each payroll cycle to review: payroll reports, anomalies, unexpected pay items, time-off entries, retroactive changes. Going forward, this process will help you avoid everything piling up in December.
Keep in mind that a compliance review must confirm that payroll records, including employee earnings, time worked, and tax forms, are securely retained for a minimum of six years from the end of the last tax year to which they relate, which is a CRA requirement.
Run a “mini-audit” periodically and ask yourself these questions:
- Are all employees paid correctly?
- Were overtime/holiday/leave handled properly?
Tip: Make sure to explicitly check if statutory holiday pay and mandated leaves (e.g., family responsibility leave, bereavement leave) were calculated correctly according to provincial employment standards. These calculations are complex and frequently audited.
- Are tax withholdings correct?
- Has anything changed (location, pay structure, tax status) that needs updating?
As year-end looms, prepare for your final payroll: issue slips, verify filings, and give yourself the head-room to resolve any issues. Keep in mind that a little consistency now saves a lot of stress later.
Step 5: Track time the smart way
If you’re still chasing down timesheets or manually entering hours, you’re doing extra work (and maybe setting yourself up for errors).
Modern time-tracking tools like Rise integrate directly with payroll so that when someone logs time off or extra hours, it updates automatically. Double-entry is a thing of the past — and so are mistakes driven by manual updates.
Step 6: Set up smooth onboarding for employees
Payroll plays a huge role in how new employees experience your company. A smooth onboarding process — where everything from direct deposit to tax forms is ready to go — builds trust from day one.
Set your new hires up with:
- A self-service portal for viewing pay and tax info
- Automated onboarding tasks (like completing TD1 forms)
- Clear instructions on how payroll and benefits work
When your payroll runs without a hitch, your employees will appreciate just how seamless it is (including the ones who have been there longer). The result all around? Higher retention rates, which boosts your new hires’ confidence and trust in the company.
Step 7: Consider your industry and region-specific needs
Every Canadian business is different. A retail shop in Calgary has different payroll needs than a tech startup in Toronto or a healthcare clinic in Montreal.
Here are a few options to consider as you make your choice of payroll software. Look for a system that adapts to your world — some options may include:
- Quebec-specific forms like Relevés (RL-1)
- T4A forms for contractors or commissions
- Industry-specific pay structures, shifts, and benefits
In a nutshell: your payroll system should adapt to your industry and region. It shouldn’t force you into a “one-size-fits-all” model. And when your tool understands the specifics of your business, you’re less likely to hit compliance issues or employee confusion.
Rise can help take payroll off your business checklist
Ready to save time and money?
Rise is here to help.
Our all-in-one people management platform brings together payroll, HR, benefits, time management, and employee records in one platform designed specifically for Canadian businesses.
And when everything connects? Well, you eliminate duplicate data entry, reduce errors, and give employees a seamless experience.
On top of this, our Fully Managed Payroll combines expert processing with the convenience of an integrated platform. Your team approves payroll with a few clicks, employees can easily access pay information, and you get real-time visibility into labour costs and trends.
Canadian compliance is built into everything we do: automatic tax updates, multi-provincial support including Quebec, and year-end documents that meet CRA standards.
So what are you waiting for? Book a demo with our Fully Managed Payroll team today.
FAQs
Who’s this checklist for?
1. Small-business owners doing payroll manually
2. HR or payroll managers looking to simplify and streamline
3. Teams that want to be confident they’re staying complianc
What exactly is a payroll checklist?
It’s your go-to guide to make sure nothing slips through the cracks — from collecting employee info to year-end filings. Think of it as your “recipe for stress-free payroll.”
What’s the best payroll solution for small businesses?
Modern automated payroll solutions are the best choice when choosing a payroll provider. Choose a provider like Rise that’s built for Canadian businesses and handles accuracy, compliance, and the employee experience all in one place.
How do I file small-business taxes in Canada?
Let your payroll software do the heavy lifting. It automatically calculates deductions, files forms with the CRA (and Revenu Québec), and keeps everything compliant — so you can focus on running your business.
