Benefits of a Payroll Management System
Payroll accounting is an essential process for any business. You need to pay your employees accurately and on time to avoid low morale, poor performance, and perhaps even reputational and legal problems. A good computerized payroll system can help you make your payroll process faster, more efficient, and more secure.
The term “payroll software” refers to the automation of the full range of payroll tasks required to calculate an employee’s salary, calculate the statutory deductions, determine the amount of payments to be made and ensure that the calculated amounts are paid to employees on time.
Payroll accounting is traditionally a lengthy process that is repeated every month. Now, at the touch of a button, payroll software calculates each employee’s gross salary, deductions, compliance, and net salary and processes them immediately.
In addition to calculating and paying out wages and salaries, payroll accounting also includes calculating all legal contributions (employee and employer contributions), creating reports in the format required by law, and submitting (filing) these reports with the amounts to the appropriate government agencies.
In addition, employees must be informed about the salaries paid to them, taxes deducted, refunds, etc. This is done via payslips.
What are the advantages of using payroll accounting software?
A payroll accounting software offers many benefits for the user (HR and/or payroll administration), the employees and the organization.
Here are the seven most obvious benefits you can get if you switch to online payroll software for your small business;
1. Lower cost
With the advent of SaaS, everyone wants to pay only for what they use. While this is a critical function, organizations want it to be managed using software that evolves accordingly. No one wants to make a big investment upfront. Online payroll software is available in monthly, quarterly, semi-annual, and annual plans. It is calculated on a “per employee, per month” basis. It’s profitable!
2. Ease of use
Payroll software can be easily configured with different features, options, rules, and business policies, depending on the needs of your organization. All necessary payroll accounting entries, such as attendance data, information on lost wages, salary structure, etc., can be easily configured. At the click of a button, payroll can be modified for all employees. Payslips are published immediately and bank transfer statements are ready to be downloaded for payroll payments. All this is possible thanks to the self-explanatory user interface and the well-designed payroll process (the option of a guided checklist is also available).
3. Facilitating the regulatory aspects
The monthly calculation of taxes, the deductions, and the submission of the legally required transfers (PF, ESI, PT, etc.) are frustrating and time-consuming tasks. These are tasks that can lead to hidden losses for the organization. In addition, incorrect reporting can lead to fines and penalties for the organization. With online payroll software you don’t have to keep up with the latest laws, amendments, changes, and tax returns because the software provider updates the payroll software automatically and without downtime!
4. Quick and easy payroll reconciliation
Payroll software allows you to verify the accuracy of each payroll by using a variety of payroll reconciliation tools available to you. You can compare the current and previous month’s payroll and also customize the payroll register and payslips to suit your needs. With this feature, you can breathe a sigh of relief and rest assured that there are no errors in your payroll!
5. JV account generation
To ensure a seamless connection between your finance and payroll teams, the payroll software allows you to easily create JV accounts via :
- Built-in formats for Tally
- Advanced Excel output functions
6. Preparation of several reports
With the cloud-based salary management system, you can receive numerous reports, including;
- Reconciliation reports
- PT reports
- MIS reports
- Ad-hoc and user-defined reports
- Customizable salary declaration/salary register
- Reports within the framework of the Store and Establishment Acts of various states
- CLRA reports from different countries
7. Integrated holiday and attendance data in automated
The inconsistency of systems for managing data such as leave, attendance, and employee information makes it cumbersome to constantly switch from one system to another for salary processing and tax calculation. An ideal payroll software will be the only source of truth for all dimensions of an employee, supported by a solid integration framework. All data required for payroll accounting is automatically updated from the database of vacation, attendance, and employees as needed. This saves you a lot of time when entering and checking the data.
Disadvantages of payroll accounting software
Payroll software, like any other computer system, can have certain weaknesses. Problems may arise in the following areas, for example
- Data security, loss or theft
- Cybersecurity and fraud
- Access to information, quality and control
Other limitations of payroll software are often due to cost reasons. Fully functional software is generally more expensive than manual payroll systems. It also requires computer hardware, resources, and qualified personnel. If you don’t have it in-house, you have to invest money in its production.
Looking for an automated Payroll Management system, we suggest you IceHrm which is one of the best HRIS systems which has so many HR functions automated into one system. Get more details here.