Running Your First Pay

Ready to run payroll for the first time? Follow our step-by-step guide to make sure your employees get paid correctly. 

Running payroll can seem complex… but it doesn’t have to be. Following a clear process and equipping your business with a good payroll provider will put you in good stead for your payroll to run successfully every time.

A PAYE Intermediary and payroll software provider such as Thankyou Payroll will provide you with the simplest path to running a pay. Let’s take a look at what’s expected of you in this scenario to make sure your employees get paid.

So you’ve opted for a PAYE Intermediary and you’re ready to run your first pay. Now what? Let’s break it down…

Photo by Christina @ on Unsplash

Step 1: Check your employee agreement

Before you proceed any further, it’s vital that you cross-check your employee’s employment agreements with the information you’ve entered in your payroll software (i.e. wage/salary, leave entitlements, and deductions).

While this may seem tedious, it means you can be 100% certain that you’re meeting the agreed contractual obligations – the last thing you want is an unhappy employee with the wrong pay or no pay.

If you’ve opted for Thankyou Payroll, our fantastic onboarding staff will also provide you with an extra set of eyes by checking that your setup in the system looks correct and isn’t missing any important information.

Step 2: Define your payroll timeline

When do you want to pay your employees? That’s entirely up to you. However, once you have selected your pay period (weekly, fortnightly, or longer) and pay date (any day of the week following the end of the pay period), this is then fixed.

With this in mind, it’s a good idea to consider your business’ cash flow patterns and the resources you have available to process your payroll to ensure that you make an informed decision – before it’s locked into your employees’ agreement.

Step 3: Determine the employees you are paying and check their entitlements

Your next step is to figure out which employees you’re paying. For some employers this will be straightforward, but for many others this may differ from pay period to pay period.

Once you’ve determined which employees need to be paid for the previous pay period, you need to make a few checks:


  1. Make sure you validate your employees’ timesheets to confirm their hours – if you’re paying employees who work variable hours or are casual workers, it’s important to be especially cautious.
  2. Take note of any leave your employees have taken during the pay period so that you can allocate leave correctly.
  3. If any of your employees worked on a public holiday during the pay period, you need to check whether they are entitled to an alternative holiday or a higher hourly rate for the time worked on that day.

Step 4: Confirm payments and deductions for each employee

This is where checking the employee’s employment agreement is especially important, as you’ll need to make sure you are paying the agreed pay rate for the employee.

And as you’ll likely be aware by now, there are also various deductions you need to confirm which will vary for each employee, depending on their tax code, KiwiSaver contribution rate, and employment agreement (which can include custom deductions).

The good thing about PAYE intermediary software is that once these specifics have been entered into the system once, you can forget about them.

Step 5: Choose your payment method

Time to fund your pay! You can choose whether you want to set up a Direct Debit or pay via Internet Banking. We recommend Direct Debit as it’s often the easiest; all you have to do is check you have enough funds prior to finalising your pay, and your money will be automatically debited from your account.

Step 6: Leave the rest to us

Lucky for you, there is no ‘Step 6’ – this is where your responsibilities end and ours begin.

While you’re busy spending your time and resources on the things you love most, we’ll take care of depositing your employees’ wages into their account, paying IRD their deductions AND filing your employment information forms within 2 working days to save you from the stress of pricey fines.

You’re not expected to be an expert (that’s where we come in), but hopefully you now have a broader understanding of how payroll works, and what’s required of you (or, not required of you!) when you run your pay with a PAYE Intermediary like Thankyou Payroll.

Thankyou Payroll’s Monita Reddy elaborates on our step-by-step guide to running your first pay.