The simple answer is that payroll is a means by which we pay our employees, while collecting statutory taxes, then paying those taxes and reporting the taxes and associated wages to various local, state and federal government agencies in a timely fashion.

Then payroll begins to get difficult. We have to track various information about our employees, such as pay rate or even rates if we pay them different amounts for different functions or times of the day that we ask them to work. We track their address, phone number, social security number and their W-4 withholding status.