Payroll Management Definition
A company’s administration which does the financial record of the salaries, wages, bonuses, and deductions such as PF, Professional Tax, labour law and related other statutory compliance of their employees.
Secondly, a convenient way to pay employees
First thing about online payroll is, it helps in saving time.
Thirdly, Calculations of employee, leave management, etc, is taken care systematically and professionally.
Salary is important for every employee and companies ensure to do the remittance with accuracy and in time. Payroll process is a necessary and essential function in the companies, which involves doing a “Net Pay” to the employees, after the necessary taxes and deductions in the payroll management system.
On the taxes and deductions as per the government laws and regulations – PF, Professional Tax, labour law and related other statutory compliance is to be managed, which is possible to do in the payroll systems . To have an efficient payroll process the company needs change with time by implementing an online payroll software.
Market trends of managing the Payroll: Payroll management in the business is done in various ways. Majorly the payroll management process by the companies are done as mentioned below,
Firstly – Excel based wherein the spreadsheets are used to do the payroll management
Secondly – Outsourcing the consultants who prepare the Payroll
Final – Preparing the payroll with the use of software. But today the majority of them have started using online payroll software and the advantage of online payroll software efficiency increased, providing comprehensive payroll processing, eliminating the hiring an outside person for payroll service and simplifying the computation. It is helping the management and the administrator who is preparing the payroll can access from anywhere, anytime with the help of the internet.
How Payroll software benefits and saves time ?
Online Payroll saves time where companies are able to access from anywhere as it is an online payroll software payroll. With the advent of more advanced internet technologies, anyone who is an authorised employee can access the internet connection and work on the same. Attendance or Employee details can be uploaded through excel, which saves the time of doing it manual each time. The benefits of the payroll systems automatically handles all complicated tax calculations, and other deductions. Hence, the business owner does not need an accounting degree, to ensure the tax man is satisfied. Depending on the companies need all statutory deductions like profession tax, PF, ESI, TDS is taken care of in the payroll management process.
Different stages maintained in the payroll
A company person who is responsible to manage the payroll, needs to be cautious while doing the planning of payroll. As we all know it is an ongoing process every month and this activity needs attention, monitoring on the changes as and when needed on the withholding amounts of an employee. Moreover the incentives to be paid – as this is considered as one of the employee motivation factors. Employees are paid either via paper cheque or direct deposit or online banking. Even the independent contractors can also be taken care of if necessary in the payroll. To manage the different payroll stages in the entire process are pre-payroll, payroll ready for payout and after activities of payout in payroll.
There are few policies to be taken care while preparing and payout in the payroll management process. The net payout to the employees are affected in different ways and such are attendance policy, leave management policy, benefits policy – bonus,any incentives,etc. These points are too well defined in the payroll management system with an approval of the higher authorities or management before the payroll processing.
Gathering inputs involves working collaboratively – a team work and regular interactions with the different departments and staff. In the big companies there is a every half yearly salary revision, attendance bonus, incentives, etc. hence, these data is to be verified and approved as per the protocol during the pre-payroll stages. Smaller companies are usually consolidated. On receipt of the data, input validation of the data is as per the company policy, approvals to be taken, ensuring no employees are missed out who are with the companies payroll and to be cautious about the employees who are not in the payroll are included in the salary payout.
Payroll ready for payout
Finally the payroll is ready with the necessary calculations data for payroll processing. Here the adjustments of necessary taxes and other deductions are done, approved by the protocol authorities and it has been reconciled. Online payroll software is ready to process the payout.
After activities of payout in payroll
Salary payout is usually done by cash, cheque or online banking or bank transfer. Nowadays the majority of the companies provide the employees salary bank account. On completion of the payroll, the company needs to send a salary bank advice statement to their company bank account managed branch with the employee’s details bank account number, salary figure payout to be remitted, and few other information as per the bank requests. Moreover the statutory deductions which were deducted while processing the payroll is remitted by the company to the respective government bodies.
To maintain and manage these records payroll management systems are necessary and important in the organization. All the financial transactions related to the salary payout is also maintained in the books of accounts. Payroll management process is essential in the company to check all components related to the salary and reimbursements done.
There is even a secure website for employees to log into so that they can have 24/7 access to all their previous pay stubs and tax information, minimizing the need for them to hassle their boss for this. Employees can view their own information. Enable workflows like leave application, reimbursement claims and much more.
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How to Manage your Payroll Efficiently
- Invest in a Payroll Software
To make your business run more steadily when it comes to its financial aspect, it is best that you always invest in payroll software. There will be many things that will require your attention, and using software for your payroll system will make it very much easier for you on a daily basis.
Investing in a payroll system will also automate all your systems, reducing the probability of human errors in your payroll. In addition to that, an automated system will make all your processes very much simple and will also save enough of your time. Time is really money, especially when it comes to your business.
- Go through Payroll Training
Having to fix the payroll system and managing it at the same time is not an easy attainment. Because policies and technology keep on developing and changing, it is important that the people who are handling your payroll system must be updated. To do this, your payroll team must go through regular training sessions so that they can keep your systems updated.
While learning about new technology and policies, your Human Resources or Accounting staff should also be up-to-date with the latest news concerning laws on employment and policies regarding tax regulations. It is best to control what you can control, which includes enduring the law. Once a mistake is made, it will be very difficult for you to correct it. So, to be more specific, just make sure that your staff is well-informed all the time. This is key to having a systematic and effective payroll system.
SalesBabu Business Solutions Pvt Ltd, Bangalore, innovative enterprise Payroll solution, PayPLUS addresses the needs of SMEs in India.
To make the payroll management system successful, companies need to ensure that every staff from the different departments share their inputs related to the payroll policies in a timely manner. Companies want the payroll management process used to reduce the friction of getting the data from different sources of departments. It helps in automating payroll computation, leave management, attendance management,etc.
As it is an online payroll software, which is being used by many enterprises successfully, solving their worries in payroll preparation.