How to add and pay contractors

System Posts: 412 admin

How to add and pay contractors

You can pay independent contractors using Payroll by Wave. Because of their special tax status, contractors are considered vendors in Wave. This keeps your accounting accurate and your business com.

Comments

This process worked for my first bill & Wave Payroll Direct Deposit, but NOT for my second. The Bill shows as Success (a status I do not see explained anywhere) - and it is still showing as unpaid. This means my 1099 year end forms and year-end transactions are all OFF. The Vendor did receive the payment but the WAVE transactions are not responding as expected -- and I do not have the option of manually paying the bill. Asked Chat for support, but no answer yet - still looking at articles for help. Anyone ever have this "success" (but not really "success") issue?

I can’t find any of these!
No option for “Type/1099 contractor”, nor “subcontracted services” under Expenses.

Sophia Member Posts: 147 ✭✭

hi @KatesHere, you'll be able to mark a vendor as a 1099 contractor under Purchases > Vendors. You'll need to create the vendor and mark them as a 1099 contractor first before you can create bills for them under Expenses. @tmsprojectconsulting, thanks for pointing out that the article does not define "success" - I'll make sure it gets added. In this case, it means that the bill payment has been successfully added to your next payroll run, but that it hasn't been paid out yet. Were you able to successfully speak to a support specialist? Please let us know and I can get a payroll specialist to assist. Thank you!

Ryan_W Member Posts: 452 ✭✭✭

Hey @KatesHere, it looks like there are still other actions you need to take in setting up Payroll with us before adding contractors. I recommend clicking Payroll > Run Payroll > Payroll Set Up (in the top right corner), and follow the prompts there. If you're still stuck, please submit a support request here if you haven't already!

Devin Member Posts: 10

How much does it cost?
Paying contractors through Payroll by Wave costs $4 per contractor paid per month, in addition to your payroll base fee. You will not be charged the $4 fee on months you do not pay the contractor. Is this accurate for both Canada and US? And is this fee in CAD currency? Thanks.

Hi @Ryan_W , it seem that I have to pay $39/ to do payroll. what if I don’t intend to use the payroll to pay my subcontractors? Can’t I just enter them as a vendor? That’s what I thought I was supposed to do if I didn’t need the payroll services. I’m confused now..

ZoeC Member Posts: 388 admin

Hey @Devin, yes that is correct for both Canada and the US, Fees in US are base fee + USD$4/employee/contractor, fees in Canada are base fee + CAD$4/employee/contractor. Hey @KatesHere in order to pay contractors through Wave to generate 1099miscs you have to have an active payroll account. If you do not need to pay your contractors via direct deposit and have Wave generate 1099miscs for them, then you can still add them as vendors and create bills for their services without an active Payroll account. I hope that clears things up!

We are currently operating a marketplace that connects buyers and vendors (independent contractors). Due to the nature of our business, the traditional marketplace payments dont work for us (ie. Stripe Connect). My biggest question is, when we invoice the buyer for the vendor's services, is there anyway to connect/associate and invoice to that specific vendor so we can easily identify which vendor needs to get paid once we receive payment from the buyer? Ex:
Buyer buys $100 service from Vendor
We create and send invoice to Buyer on behalf of Vendor
Buyer pays us $100, we take our fee and pay the Vendor the balance.
Is there a way to do this more seamlessly? Also, is there a on-boarding portal for vendors to create and manage their own account, including banking information for direct deposit? Or must they contact us to have any updates made? It would also be nice for each vendor to see history / total paid to date. Thanks,
Joe