Why businesses need to implement payroll software.
Though it may not be the most exciting part of running a company, preparing a payroll is an essential part of any business. Payroll processing has been with us for a longer time than most of us cannot recall. It can be traced back to the 14th century.
Any business process with such a significant effect on your business is going away anytime soon. The big question therefore is, how can you manage your payroll needs effectively?
As one of the most complex business processes, payroll preparation needs utmost accuracy and can even reduce your employees' motivation if not done correctly.
Your staff looks upon your and the HR department to pay them correctly and on time. However, this process can prove challenging for business owners to understand the variations involved in payroll processing and find the time to confirm it is correctly done.
This is the point where the importance of payroll processing software comes to the rescue. Throughout this article, we will explain why your business needs to integrate payroll processing software in its operations.
What is payroll processing software?
Payroll processing software is a digital tool aimed at automating and restructuring the process of paying the company's employees, making the process standardized and less time-consuming.
Payroll management solutions can be acquired from the solution vendors offering the software as a service separately or contained in the enterprise resource planning package (ERP) package as a section.
Though payroll processing software will handle most of the tasks for you, it will not render your payroll specialist jobless.
Having a clear insight into your business' needs and the payroll software's quality will guide you in determining which solution will serve you best and how to implement one.
Features of an efficient payroll processing software
Luckily for HR departments and accounting professionals, payroll software can handle all the hard work regarding payroll preparations. From storing the basic employee details to keeping you updated with tax laws, there is nothing the software can't do for you.
Some payroll solutions are featured as a part of the human resource information system, which has tools that help manage various HR activities.
Adding the number of hours worked manually can take up to 20 minutes per employee. This is just one step towards preparing a payroll. There are still some additional considerations to be added like overtime and the rate of pay,
Technically, you will need a lot of time to solve the payment of employees. A useful payroll processing software can automatically track every employee's time and attendance, saving you time and effort.
Despite the different software capabilities and the fact that there are still things you will need your payroll expert to handle, payroll software will save you time in a big way.
Check out the common features of payroll software below:
For companies and businesses that pay an hourly wage, tracking time and attendance is sure of paying correctly. This is one of the great features a payroll software that it will bring on board. Effective
Having a system that combines both timekeeping and payroll eliminates tracking the employees using their job cards. These solutions can monitor sick leaves, absence, hours worked, and overtime.
Using the information tracked, the software can sync the details seamlessly to generate a perfect payroll.
The obvious reason for implementing payroll software is payroll management. The ability to calculate wages automatically on a preset schedule is a significant advantage to payroll experts.
However, after implementing the software, it will prepare the payroll with some little effort from your side rather than frequent customizations.
To most businesses, tax laws are confusing and dull. It is too easy to confuse and misunderstand federal and state tax laws. It is even much difficult to comply with most of the social security requirements.
To further complicate the issue, tax laws are continually changing. You can easily miss out on the updated changes if not keen enough. Herein is another benefit of payroll software to your business.
Most of the payroll processing software is set to update automatically as the tax law changes occur, relieving you of the often confusing and boring reading of the updated changes.
Also, depending on the software you choose, the payroll software can be able to fill the required forms when the time to fill tax forms reaches.
Though you will still be required to sign the forms yourself, the software will help you when the time reaches for filing the returns. This will save you the stress of filing for extensions and facing the penalty charge for late payment.
Additional financial management such as bonuses, expenses, and benefits can all be handled by payroll software. The software can track and calculate the costs to be paid to each employee.
Whether the company wants to account for employee paid off day or mileage reimbursement, the software will correctly provide that.
Human resource management is more than meets the eye, and any solution that enables employees to control their finances is undoubtedly a welcome idea.
Some software solutions enable employees to lodge their financial complaints and communicate their concerns to financial managers seamlessly.
Implementing a system with these capabilities ensures that accounting and tracking of financial data are easy and accurate.
A useful payroll processing software can also help you produce various financial reports and summaries. It can generate several reports like salary reports, reimbursement, or benefits report.
Additionally, payroll software also comes in handy when you want to keep your financial information records. The feature enables you to store, trace and automatically update employees' information records.
Why it is essential to implement payroll processing software to your business.
A payroll software eliminates a lot of workforce and guesswork that is associate with payroll preparations. It automates and organizes the work, allowing you to notice any errors quickly.
This helps your team to be more accurate and efficient-the two most important factors when preparing a payroll.
Let's look at the benefits payroll processing software will bring to your organization when you implement one in your financial processes.
1. Increased revenue.
In most companies, tracking a payroll can result in a long excel spreadsheet with many details to track. Details such as the hours worked, overtime, pay rate, and sick hours all need to be accounted for.
With these factors, an error is inevitable. Any simple misplaced decimal or a typo when doing manual data preparation can result in significant financial losses. Luckily, these errors can be easily avoided when you use payroll software in doing your financial management.
When you integrate payroll software in your business, you are sure that salaries are being paid correctly, you can easily track your financial information and be safe with the taxman. You rest easy knowing your HR team will not be taking time correcting errors.
According to the American payroll association, this kind of efficiency can lead to the reduction of associated payroll processing costs up to 80%. You also get to avoid penalties involved with late tax returns and inaccurate bookkeeping.
2. Happy employees.
One of the significant benefits you will get as an organization using payroll software is increased employee retention. The reason a person will accept your job offer is because of the promise you made to them. Failure to meet those promises can be so detrimental.
According to Aptitude research partners' study, 49% of workers in America will leave a job after two consecutive paycheck errors. You cannot afford to be hiring every now and then because it is costly.
A payroll software reduces human error chances, which could lead to costly payroll mistakes and inaccurate paychecks.
Accurate paychecks delivered regularly on time can be all that is needed for satisfied employees. This happiness and assurance results in increased productivity among your team.
3. Easy customization.
Using payroll processing software allows for in-house changes to be made quickly without hassle, even after having your initial deductions and withholdings.
In case there is a change that needs to be done, authorized operators can access the dashboard and make the required changes without contacting the third party.
A cloud-based system can allow users to do the changes at the comfort of their homes home as long as they have access to the system. The use of in-house software ensures that critical business and employee information is kept safely.
4. Promotes business growth.
Payroll software is an excellent tool in helping you notice the gaps that require adjustment in your organization. Using payroll software helps generate automated financial reports, which you can use to see how much your employees cost and if there is room to add more staff to your team.
An operational software has a fast employee profile set up, enabling your team to onboard new hires in no minute.
Despite the additional employees, you will not have to add time in processing their paycheck; the software will handle that without affecting your time plans. It takes just a few clicks of a button to get your employees paid correctly and in time.
5. Increases productivity.
Using effectual software leads to streamlining of financial operations in your business, leading to time-saving. This time can be used to handle other essential tasks that require attention, reducing the backlog of jobs hence improving productivity.
When you spend less time on recurring tasks, more time and energy are directed towards finding creative solutions for your organization's bigger objective.
Furthermore, implementing payroll processing software ensures you pay your employees correctly and timely, making them satisfied and happy being in the firm. And when your team is happy, their energy increases, and they feel motivated, increasing the production rate.
6. Helps in tax compliance.
Most of the payroll software is designed with an in-built system that automatically links with the various state or federal tax laws. They are able to calculate the tax returns, bonuses, or penalties if you have any.
You do not have to worry about the constant changes that are characterized by the tax bodies; the software will automatically update the changes on the system.
You will also be receiving notifications when the time reaches for tax returns, relieving the penalty payment due to late filing or poor bookkeeping.
Tax processing is a tedious, time-consuming, and error-prone procedure. However, no business can do without it. To ensure effective financial accounting, payment of employees, or even accounting for mileage reimbursement, you have to do payroll processing.
Employing the use of payroll processing software, you get many benefits both to the company and your employees. Payroll software will relieve you of the burden of doing payroll processing by streamlining every detail involved in the process.
Payroll software will save you time by automating the calculations of salaries, avoiding errors, automating tax compliance needs, and tracking the attendance of your employees.
Paying your employees correctly and on time will make them happy and satisfied, giving them a reason to stay with the organization for long. A happy team is motivated and reciprocate that into increased productivity.
You also get to rest easy knowing that you will not cross paths with the taxman. The software will automatically notify you when it's time to file your returns and do the form filling automatically.
If you want to increase production, foster growth, and avoid the error that is prone to the manual payroll process, you should implement the use of payroll processing software. You will surely not regret it.