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Financial Services & Accounting Firms: Payroll Features Every Business Needs (2026)
Financial services firms need payroll configured for deferred compensation structures, FINRA recordkeeping and performance fee payroll, pay codes that general-purpose software leaves to the customer to build. BEG runs financial services firm payroll for $45 per employee per month inside the payroll software you already use, all-inclusive, live in 3 to 5 business days.
Pay codes a financial services firm cannot run without
Financial services firms pay financial advisors and CPAs on different bases, and the payroll system has to hold every one of them as its own pay code with the right tax and overtime treatment: deferred compensation structures, FINRA recordkeeping, performance fee payroll and Series license holder compliance. A generic setup collapses these into hourly and salary, and the errors show up in the regular rate, in year-end forms and in the first wage claim.
Financial services employees generally meet the administrative exemption duties test when their work includes collecting and analyzing a customer's income, assets, investments or debts, determining which financial products fit, and advising on their advantages and disadvantages. An employee whose primary duty is selling financial products does not qualify for the administrative exemption.
To be exempt as executive, administrative or professional employees, workers must be paid on a salary basis of at least $684 per week, equal to $35,568 per year. The highly compensated employee threshold is $107,432 per year, including at least $684 per week paid on a salary or fee basis.
Tax handling specific to financial services firms
If a nonqualified deferred compensation plan fails section 409A, the deferred amounts become includible in the employee's income, are reported on Form W-2 box 12 code Z, and are subject to an additional 20% income tax plus a premium interest tax, both assessed on the employee. Amounts that are substantially vested and paid no later than March 15 of the following year fall under the short-term deferral exception and are not subject to section 409A.
What is configured before the first run
At implementation every pay structure above is built as a code with its own taxability, its own overtime treatment and its own W-2 mapping, and the exemption status of financial advisors and CPAs is documented against the rule that supports it. That is the difference between software with the features and a payroll that uses them correctly.
The rules behind this page, with sources
General information, not legal advice. Every rule below was read on the agency page linked next to it.
- Financial services employees generally meet the administrative exemption duties test when their work includes collecting and analyzing a customer's income, assets, investments or debts, determining which financial products fit, and advising on their advantages and disadvantages. An employee whose primary duty is selling financial products does not qualify for the administrative exemption. [DOL Fact Sheet #17M]
- To be exempt as executive, administrative or professional employees, workers must be paid on a salary basis of at least $684 per week, equal to $35,568 per year. The highly compensated employee threshold is $107,432 per year, including at least $684 per week paid on a salary or fee basis. [DOL WHD Earnings thresholds for the EAP exemption]
- If a nonqualified deferred compensation plan fails section 409A, the deferred amounts become includible in the employee's income, are reported on Form W-2 box 12 code Z, and are subject to an additional 20% income tax plus a premium interest tax, both assessed on the employee. Amounts that are substantially vested and paid no later than March 15 of the following year fall under the short-term deferral exception and are not subject to section 409A. [IRS Publication 5528, Nonqualified Deferred Compensation Audit Technique Guide (Rev. 3-2024)]
Read the full guide to every managed payroll feature, explained, and the rest of the financial services firm payroll library.
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Frequently Asked Questions
How do you handle deferred compensation structures?
Deferred comp plans under IRC 409A are handled with correct payroll treatment for the deferral year and distribution year, including W-2 Box 11 reporting.
Can you handle FINRA payroll recordkeeping requirements?
FINRA registered representatives require payroll records maintained for at least three years. We maintain complete records and can produce them in response to a FINRA examination request.
Can you produce Form 5500 payroll data for our benefit plan audit?
Yes. We produce payroll-based data including eligible compensation by employee, contribution amounts, and plan participation data to support the annual benefit plan audit.
What does BEG charge for financial services firm payroll?
Financial services payroll runs at $45 per employee per month. Deferred comp handling, FINRA-compliant recordkeeping, and 5500 data production are included. For a 20-person firm, that is $900 per month.
What does managed payroll cost for a financial services firm?
$45 per employee per month, all-inclusive, inside the payroll software you already use, with no monthly minimum. Deferred compensation structures, FINRA recordkeeping and performance fee payroll are configured at setup, not billed as add-ons.
Related Resources
Anthony leads payroll solutions at Business Executive Group, a national managed payroll firm serving businesses across industries including Financial Services & Accounting Firms. BEG manages payroll at $45 PEPM, all-inclusive, with deep expertise in compliance, multi-state filing, and industry-specific payroll requirements. Get instant pricing at beghr.com.
Authoritative source: U.S. Department of Labor: Wage and Hour Division
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