How Do Holiday Bonuses Help Your Bottom Line?
The end of the year is quickly approaching. Businesses are trying to find legitimate ways to decrease their tax bill while keeping their business profitable. There are many ways a business owner can dwindle their tax bill.
May employers may choose to order products for their office that they have held off on ordering throughout the year. They may also choose to send holiday cards and gifts to their clients. Additionally, they may choose to throw lavish holiday parties for staff and clients.
One way employers can benefit their employees and business while helping their bottom line is to provide holiday bonuses to employees before the end of the year. Holiday bonuses are a great way to save tax money and show appreciation. Read on to learn more about the benefits of providing holiday bonuses to your employees this time of year.
Holiday Bonuses Show Employees You Care
One of the benefits of providing holiday bonuses is showing your employees you care and appreciate them. Bonuses let employees know that their work has not gone unnoticed. Instead, they know that you appreciate the hours of work and dedication they provided for you and your business throughout the past year.
Furthermore, it shows that you care about your employees on a more personal level. Holiday bonuses are often used to replenish money individuals spend on holiday gifts for their families and loved ones. Providing a holiday bonus to your employees shows that you want them to enjoy their holidays without going deep into debt.
Employees appreciate a holiday bonus as much as employers appreciate their staff. They feel seen, cared for, and important to the workplace. As a result, they often are more productive throughout the year. They may be willing to work extra hours, conduct additional duties, and work harder overall.
Holiday Bonuses Provide a Tax Write-Off
Holiday bonuses count as a payroll expense. Therefore, providing holiday bonuses to your employees provide you with a tax write-off for your business before the end of the year. Tax deductions help decrease your tax bill to the IRS.
As a result, your business will benefit financially from paying out holiday bonuses to your employees. The larger the tax deductions, the less money you have to pay to the IRS during tax season. As a result, you have the ability to keep most of our profits in-house as opposed to providing them to the federal government.
Holiday bonuses are only one piece of the tax puzzle. However, they provide a significant deduction to your profits as well as your tax bill.
Workplace HCM Can Help You Use Holiday Bonuses to Protect Your Bottom Line and Show Employees You Care
There is a right way and wrong way to pay out holiday bonuses to your employees. If you have never provided them to employees in the past, you may want to consult a qualified HR team to help you properly implement the process. With their help, you can ensure you get all the benefits a well-executed holiday bonus program provides while ensuring your employees know you care about their hard work throughout the year.
Workplace HCM can help you implement a holiday bonus program while ensuring proper payroll taxes are withheld as needed. Call us at 856.334.9711 to learn more about how we can help.