Definition of Payroll Software:
Payroll software is an end-to-end HR solution that takes care of all the payroll operations such as time-tracking, attendance, wages, tax filing and tax deductions, insurance premiums, paying employment tax and so on. Payroll software has employee self-service (ESS) features that let employees take care of all their information and enter their wage information and work hours.
Benefits of using Payroll software:
Payroll is the largest expense that a company incurs. As a result, it is rather important to pay attention to the details and avoid errors at all costs. Payroll software comes to the rescue, thanks to its ease of use, its auto-compliance and its ability to avoid errors. It saves a lot of money and frees up time for the HR and Finance team to focus their efforts on productive goals and not on mundane tasks.
It is a boon, particularly if you have outsourced your payroll operations as it reduces the number of stakeholders involved and the errors likely to occur by them. If it integrates with your HR system or is a part of your HR software, it becomes further easier to collect wage, attendance and time-tracking information from your employees.
Here are some ways in which payroll software can help you:
- Manages all your employee documents at one place: Your payroll software will maintain all the payslips and compensation details of your employees. You can delete the details of old employees, add or update the details of your existing employees at any time. Furthermore, your employees can access this information anytime.
- Income calculation and deduction: Payroll software will automatically subtract all tax deductions from the gross salary. It will also let your employees add their reimbursement bills and can automatically take care of the approvals and processing. The managers have to approve/reject the entries, and the salary is processed and directly deposited into the employees' bank account.
- Helps with Tax filing: Payroll software can take care of the tax filing headache for the employees, companies and contractors. They automatically generate all tax forms that can be reviewed and submitted in the click of a button.
- Makes it easy with Employee Self Service (ESS): It makes work easier for the HR team, as they no longer have to stay on top of employee details all the time. Employees can fill in all their information themselves such as time-offs, attendance, time-tracking, onboarding documents, employee contracts and so on. They can update the information whenever necessary, without relying on the HR team to update it for them.
- Timely payroll processing: It streamlines the entire payroll process for the finance and the HR team. They have notifications and reminders that will help them plan payroll beforehand.
- Improves tax and Govt compliances: To stay on top of your company taxes, and filing reports on time can get a little difficult. You may have to save the dates and remain updated on tax amendments. Payroll software can automatically generate reports and can file them at the click of a button. They can send reminders and update themselves so that your numbers are accurate, and your company is compliant at all times.
Things to consider when choosing Payroll software for your business:
Choosing a payroll system that best fits your business is essential, and there are several factors to keep in mind when deciding.
- Have clarity on your requirements: Know what functions take up time and can be automated. See if you need constant customer support or would you be able to handle it by yourself. Once this is identified, you’ll have clarity on what to look for you when zeroing on payroll software.
- Budget allocated for payroll software: Know how much you can spend on payroll software. If you are a small business, you can choose a less expensive, basic software, whereas bigger companies can go for a solution that offers a lot more features and flexibility.
- Identify your service providers: Identify the players out there in the market and customer reviews for each of them. You may find one with the right set of features in one, and well within your budget, but if the customer service is poor, it may not be a good choice. Similarly, you would find something that checks all your boxes, but is beyond your budget. Remember to look into their integrations. Do they integrate with your performance management and HR software? Do they work with all your financial service providers? Is the product secure? These are some questions you must consider.
- Security: Your payroll software takes care of salary deposits and ESS. It contains important details that cannot be tampered with. As a result, Product security against breaches is of top priority.
- Repository of historical data: Payroll is the biggest expense incurred by any company. Therefore, it is important to have a repository of all the documents that were processed by your payroll software. It lets you control the process, identify mistakes and take measures accordingly.