Managing payroll activities is a key part of most businesses, but often in an attempt to keep costs down, the cheapest system is picked without truly looking at what is needed and how software can add day-to-day value.
So, what exactly is payroll software and how can it potentially add value throughout your business?
What is payroll software?
Simply put, payroll software is a digital tool or platform that allows you to manage your payroll actions in-house. This can be as straightforward as calculation payments, what is owed, tax and more. A solid system will allow your teams to carry out their essential tasks, with a quality system working as a powerful force multiplier that enables your team to work with efficiency and accuracy in the most exacting of situations.
What does it do?
While payroll systems will differ from business to business, the designated employee or team enters key values into the system and uses the figures to carry out practical payroll actions for each individual on the payroll. This means tracking any values that help you make a judgement, including hours worked, bank account details, deductions, PAYE and more.
How does it help?
A reliable system will take as much of the frustration and complexity out of the process as possible. This can involve streamlining tasks, providing helpful ‘value add’ functionality and much more.
Choosing the right payroll software platform can bring significant benefits throughout businesses of all sizes. Properly speccing, reviewing, and implementing a system is often at the heart of any successful business.
Some key benefits include, but are not limited to-
Scalability: Any business will change and grow as the years roll on. This can involve adding or removing staff, opening new branches, or looking for additional oversight in a complex company. Choosing a platform that can scale alongside your business can help avoid future issues and ensure that your payroll teams avoid complications that could otherwise be easily avoided.
Efficiency: Payroll actions are time consuming and an extra click here and there can quickly add up. A quality system will allow you to batch and bulk key tasks and make the difference between physical actions look like night and day. Deploying the system can also allow you to enforce best-practice, letting them learn and develop without excessive stress or fuss.
Additional Functionality: Selecting a system with helpful value adds can make all the difference. This can include analytics or dashboard functionality to give you oversight, the ability to store data in the cloud, or simply tackle tasks specific to your sector. Taking the time to review your requirements can help you end up with a tool that meaningfully helps when it truly matters most.
Adaptability: As your business changes, you’ll ideally need a system that will allow you to tackle any payroll problems that you may encounter. If a system does not match your specifications, bespoke development can expand the functionality of the platform and allow it to be fit-for-purpose – interacting with legacy systems, conducting specific calculations, or adapting to your in-house infrastructure with ease.
Error Reduction: Everyone makes mistakes. But when payroll does it, sparks can fly. Building in validation at key process steps can help ensure that mis-clicks or incorrect calculations don’t slip through. Any error can often involve multiple points of contact and result in a loss of confidence or bad blood at multiple levels of the business. Enforcing elegant validation can head issues off before they become a problem.
Do I need it?
As with many pieces of modern technology, payroll software is not a prerequisite, but it’s as close to essential as it gets.
Under UK legislation, any internally or non-outsourced payroll will need to be tendered to HMRC through the use of software. At a minimum, the system will need to track and deliver-
– Employee details
– Employee pay and relevant deductions
– All complete payroll information
– How much HMRC is required to be paid
– Calculations for statutory pay, including pat, mat, and sick pay.
If you currently have fewer than ten employees, you can use any freely available payroll software. But if your headcount exceeds ten, you will need to use one of HMRC’s vetted systems. This makes it essential to fully check that the platform you are considering is not only fit-for-purpose but provides genuine value for money and the full suite of functionality you need to complete your legally mandated tasks.