Biweekly Pay is a payment scheme where employees receive their payment on a specific day of a week and every other week. It means a person will receive 26 paychecks since a year has 52 weeks because they will receive their salaries every other week.
What are the Benefits of Biweekly Pay?
It helps employees on a budget.
It helps employees with a limited amount of money.
It saves time.
It reduces the chances of making payroll errors.
It becomes easier to calculate and keep track of.
Are Biweekly and Semi-Monthly Payrolls the Same?
Even though they may seem similar, there are quite a few differences between the two methods. Here are some of the differences:
Number of Payments yearly: In the case of Biweekly, an employee will receive 26 payments annually, whereas, in the case of Semi-monthly, an employee will receive 24 payments yearly.
Number of Payments Monthly: It is possible to get up to 3 payments in a month on a Biweekly payroll (For example, a month with 5 Tuesdays), but in the case of Semi-monthly, it is always two payments per month.
Time of payment: Semi-monthly payments are made on specific days, whereas Biweekly payments are made on fixed days.
Bonus and overtime: It is easier to calculate overtime and bonuses for Biweekly payrolls. On the other hand, it is somewhat harder to calculate overtime and bonuses for Semi-monthly payrolls.
Paperwork and tracking: Biweekly payrolls usually mean more paperwork and tracking compared to semi-monthly payrolls.
How to Calculate Biweekly Pay and Taxes?
Calculating biweekly checks is very easy. Divide your yearly payment by 26. For instance, if your annual Pay is 100,000$, then your biweekly payment is 100000/26= 3846$.
Again calculating taxes is the same as you would typically because no. of payments don't affect taxes as taxes are based on the total amount of money earned in a year instead of the total number of payments in a year.