300+ TOP Payroll Management Interview Questions and Answers

Q1. What Experience Do You Have Processing Special Pay Items?

Bonuses and incentives cannot be processed in the same manner as regular payrolls. Special forms need to filled out and extra calculations need to be made before a special pay item can be processed.

Q2. What Is A Payroll Card?

A payroll card is a plastic card which allows the employee to access their pay using debit cards. It can be more convenient than using the check casher. However if you will use the payroll cards more than once at some ATM then you will be charged extra money. However as the time passes by then you will definitely find this method to become more common and cheaper as well.

Q3. What Are Payroll Source Documents?

The Payroll source documents are the employee Time Sheets (or equivalent) that record when the employee worked and generally what they did. These records are subject to audit by the Labor Department, EEOC and probably others that I haven’t encountered. These should be bound into a Payroll Source Document folder. However, there are other employee documents that need to be retained, e.g., their original employment application, employee reviews (if you do them),that record their federal/state tax exemption choices, reporting their annual wages and with holdings, etc. These can be filed in separate Employee files (by employee name or number) — or simply integrated into the Payroll Source Document folders (in the week in which they occur). I very much favor the latter — especially if you’re doing computer accounting — in keeping with my “always file chronological” bias.

Q4. What Is The Basic Payroll Payment Service?

The Basic Payroll Payment Service offered through Chase Online for Business allows you to pay employees, temporary help, independent contractor’s suppliers and more, electronically by depositing payments directly into their accounts—either at Chase or another bank. You no longer have to write payroll checks or schedule time for your employees to cash them. Fees apply for this service.

Q5. What Is Exemption Limit Of Gratuity?

Exemption limit of gratuity that is 10 lac.

Q6. Do You Know Something About The Payroll Frequency?

Let me tell you that as far as the payroll frequency is concerned it can be high as well as low according to the company in which you are working. It can be weekly, biweekly, monthly, quarterly or even annually. However the HR department will let you know about it at the time of selection. However, to the maximum it will not be late than monthly payment in most of the companies.

Q7. Differentiate Between A Payslip And A Paycheck?

Payslip is a slip that contains all details of the employees like total wages, deduction details, tax cuttings and the like. While a paycheck is a certification that the employee has earned a certain amount and can cash it form the bank.

Q8. How Can Scope Of Internal Audit Help You?

Internal audit is an independent appraisal function which is established by the management of an organization for the review of its internal control system as a service to the organization.

Q9. Why Is Accuracy So Important For Someone Handling Payroll Activities?

There are so many calculations that one has to do and even the slightest of inaccuracy can mess up an entire payroll system. Accuracy is very important because of the amount of money involved. If payroll personnel do not pay attention to what money is going where, all accounting procedures go haywire.

Q10. As A Payroll Clerk, What Has Been Your Greatest Achievement?

I was responsible for developing and implementing a payroll auditing system which checked each entry to ensure its correlation to other fields. This not only lead to streamlining the entire payroll process but also reduced the time to manually check each entry for accuracy by a staggering 85%!

Q11. How To Define Payroll?

Payroll me processing a salary for salaried employee. There should be relation of “contract of service”.

Q12. How Good Do You Think You Are At All Of These Tasks? Where Will Rate Yourself On The Scale Of 1 To 10, 10 Being The Highest?

I am completely trained at all of these tasks because of my three years of experience and relative to that I will rate myself ten on ten. I can assure you that it is my expertise that I am rating myself full, not over confidence.

Q13. Give Us A Brief Overview Of Your Professional Career As A Payroll Assistant?

After graduating from University of California with a BBA Degree, my first full time job was at Marshall & Swift Boeckh as a Book-keeping Executive. I worked there for a year and then I was offered a better opportunity as a Payroll Assistant at Enova Financial, where I have been working for the past two years. Other than this, I have also done three internships during my degree of which one was focused on ‘compensation and benefits’ function processes of Barclay’s Bank and the other two were related to payroll management at Delaware North Companies and University of California.

Q14. What Is Payroll Management?

Pay roll management consists of maintain records for, and controlling of basic pay, increments, eligible allowances , gross emoluments and deductions for Provident fund, ESI, Income tax, other recoveries to be made from each employee, including maintenance of attendance and leave records. It also ensures proper compliance of applicable legal requirements under P.F Act, ESI Act, Income tax Act, etc., to avoid facing penal consequences. In that the management of pay roll ensures correct deductions made in pay bills of employees and timely remittance to Government and other authorities.

Q15. How Do You Calculate Gratuity?

Gratuity Calculation : Gratuity = Last Basic Pay*15 Days* Number of Year Service ——————————————-                            26 Days

Q16. What Are The General Deductions Made While Doing Payroll For An Employee In An Organization?

General Deductions are to made during payroll like Income Tax, P.F, ESI, Professional Tax etc.

Q17. What Has Been Your Greatest Challenge So Far?

I found myself in a quandary once when I had just acquired a new job and was familiarizing myself with the company’s unique payroll system. I discovered that one employee was being paid a large salary even though there were no corresponding timesheets available for him. The dilemma was whether to tell the authorities and risk losing my job or keep quiet and betray my position.

Q18. What Are Special Pay Items? Are They Processed In The Same Manner As Regular Payroll?

Special pay items include incentives, bonuses, overtime and compensation. They are certainly not processed in the same manner as regular payroll. Each special pay item is separately calculated and adjusted.

Q19. What Payroll Software Applications Are You Familiar With?

I am proficient in using:• PayCycle• Optimum Solutions – Optimum Payroll• ADP – Payroll Solutions I have also had the experience of using: • Qqest Payroll Services• CheckMark Software

Q20. How Familiar Are You With Employment Laws That Regulate Employee Pay?

I have studied and understood the Fair Labor Standards Act thoroughly, so I am quite familiar with minimum wage, overtime, commissions, and wage garnishments and record-keeping and reporting.

Q21. What Is Payroll Accounting?

Payroll accounting involves calculations of employees salaries and tax deductions. It also undertakes the activities such as preparation of tax returns, maintaining the payroll records, etc.

Q22. What Are The Benefits Achieved By Computerized Payroll System?

While doing payroll through payroll packages / any other calculated excel sheets we will get the appropriate data of salary payout / income tax payable & deductable values / statutory deductions particulars / Professional Tax deductable & payable values. Rounded off values with proper / appropriate format for filing IT & Statutory & PT will be generated through computerized payroll system.

Q23. Define Computerized Payroll System And What Are Basic Concepts Of It? What Are Input And Output Design In Payroll System?

Basic concept of computerized payroll system are personnel data file with name, date of joining, scales, basic pay, DA, HRA, conveyance, medical, entertainment, claims, special pay and leave records month wise and system generates monthly payslips for each employee according to his/her scale of designation with extra perks and pf fp insurance electricity bill detection monthly income tax also detected monthly. input are name designation scales with basic pay and incement, da,hra. convienace and other perks income tax pf fp and ehouse allotted rent with electricity deduction and output design is total pay showing basic da hra and deduction site income tax pf fp etc

Q24. Which Computerized Payroll Systems Are You Familiar With?

I am familiar with UltiPro, BambooHR, KRONOS and Namely. I am a quick learner with a knack for software operations and usually learn to operate unfamiliar software in very limited time and supervision.

Q25. How Would You Define Payroll? Also Outline The Routine Steps Part Of A Basic Payroll Processing Protocol?

Payroll can be defined as a list with names of all employees of a company along with their payable wage amounts. Payroll processing includes filling up of W-4 forms by all employees, creating a payroll records system, calculating applicable deductions, determining the suitable payment methods and making deposits.

Q26. Give Us A Brief Overview Of What A Payroll Clerk Work Involves?

Payroll managers compile payroll data, verify time and attendance and process periodic trfers of pays to different accounts.

Q27. What Type Of Skills Do You Have That Qualify You For The Position Of A Payroll Clerk?

Having worked as a payroll clerk for three years, I have developed great attention to detail which is the basis of this work. Possessing a firm understanding of mathematical concepts and accounting principles, along with exceptional data entry skills makes me a good choice to work as a payroll clerk.

Q28. What Are Some Of The Duties That You Were Assigned In A Similar Role Earlier?

Apart from collecting and summarizing timekeeping information so that payrolls can be calculated, I was responsible for obtaining overtime approvals, calculating commissions, processing garnishment requests and dispensing employment verifications.

Q29. List Three Important Skills For Someone Working In A Payroll Position.

People working in a payroll position need to be accurate, possess the ability to make sound decisions and have a high level of proficiency.

Q30. What Are The 3 Skills You Think A Payroll Clerk Must Have?

Well, I believe strong analytical skills, good command on mathematics and attention to detail are must haves for any person in the role of a payroll officer.

Q31. How Do You Conduct Payroll Tracking And Reconciliation?

For payroll reconciliation I ensure and verify that all accounts are in agreement to payable dues after tax deductions. For payroll tracking I use Intuit online payroll tracking software and also cross check the timings personally.

Q32. Working As A Payroll Coordinator Me That You Have To Be Constantly Organized. How Do You Do This?

I make sure that all the information that I need to process payrolls and additional payments is kept in one place, so that I do not need to keep looking for things. I have specialized folders for each type of data that I need so I know exactly where to look.

Q33. What Is The Purpose Of W2 And W4 Irs Forms?

IRS forms are needed by the employers while processing and forwarding income tax information. W2 and W4 contain useful data regarding tax withholding and income tax eligibility ratio calculations from employees’ wages.

Q34. Define Computerized Payroll Systems Very Briefly.

Computerized payroll systems include complete employee information including lo, pay structures, reimbursements, salary slip generation and income tax management. Since everything is computerized, it is easy to handle calculations and manage printing activities.

Q35. What Are The Major Modules Of Payroll Management System?

Major Modules of Payroll Management System are: Employee Profile Leave Management System Time Management System Payroll Management System Employee Trfer, Promotions & Increments HRD Procedures Income Tax Management (TDS) Reports (E.S.I.C & Provident Fund Statements and Chall, Government Forms, etc.).

Q36. What Do You Mean By Vouching?

Vouching is the process of checking the authentication of the voucher maintain by the management with the respective supporting document.

Q37. What Is Payroll?

The term ‘payroll’ encompasses every employee of a company who receives a regular wage or other compensation. Some employees may be paid a steady salary while others are paid for hours worked or the number of items produced. All of these different payment methods are calculated by a payroll specialist and the appropriate paychecks are issued. Companies often use objective measuring tools such as timecards or timesheets completed by supervisors to determine the total amount of payroll due each pay period.

Q38. What Do You Understand From The Word Payroll?

As far as the payroll management is concerned it is the detailed document containing the details of the salaries, wages, bonuses and deduction as well.

Q39. What Do You Think Are The Major Responsibilities Of A Payroll Assistant?

The major duties of this professional comprises: • Accurately completing payroll processing tasks, reconciliations and related reports on time• Responding to inquiries related to payroll processes and procedures in an effective manner• Resolving payroll discrepancies by collecting and analyzing information accurately• Maintaining payroll operations by following policies and procedures and reporting changes made or required• Maintaining employees’ confidence and keeping payroll operations and information confidential• Properly maintaining all payroll records and reports including annual and quarterly filings• Resolving payroll issues and efficiently communicating with all parties involved

Q40. What Kinds Of Payroll Reporting You Know About?

I am well practiced in making and issuing new hire reports, promotion reports, leave/absentee reports, deduction reports, LWAP reports, wage type and deduction reports.

Q41. What Report Are Provided To Accounting Dept. From Payroll Every Month? What Reports Are Generate At End Month, Qtr & Year End In Payroll Dept?

When preparing the payroll every month the accounts dept should be provided with the information such as status of the employee as if he is a permanent or on contract or in probation attendance and if there are any bonus to be given to the employee.

Q42. What Is Gratuity? How Is It Calculated?

Gratuity is an amount accumulated over the tenure of employees, calculated using a certain formula and is payable when an employee retires or resigns. The formula for calculation of gratuity is: basic pay divided by no of working days in a month multiplied by total number of years worked.

Q43. Does Your Company Followed Payroll Outsourcing?

No, my company does not use the payroll outsourcing but I never doubt on this method. There are many companies which are using the payroll outsourcing techniques.

Q44. How Do You Deal With Employees Who Do Not Report Time Records To The Payroll Staff Before A Deadline?

I have trained the payroll staff to handle time-dependent problems on their own by performing strict follow up duties. However, there are times when employees just do not comply. When I have to intervene, I become direct with the employee and usually send out an email, very politely outlining repercussions of not reporting time records in a timely fashion.