Online-Payroll

Online Payroll Explained

Chapter 1: What is payroll?    

Payroll is a word with two possible meanings. It can mean the accounting process of paying your staff – including the amounts for each person and the overall total. It can also mean the list of your paid employees.

We’ll look at both meanings in this guide, because understanding payroll is all about understanding the accounting regulations that cover how and when to pay your employees.

Payroll is an important part of business accounting, for two big reasons. First, because it’s a legal requirement to get it right, especially for tax purposes. Second, if you don’t pay your employees correctly then they probably won’t be your employees for long!

So here’s what you need to know in order to understand payroll for your small business.

Five areas of the law to understand about payroll    

Detailed regulations about payroll will vary from one jurisdiction to another, but there are some areas of the law that are likely to be in force wherever you run your business:

  1. Taxation
    Any business with staff must withhold the proper payroll taxes from employees’ pay packets and pay the appropriate government taxes. In short, you’re acting as the tax collector for your employees.
  2. Retirement plans and healthcare
    You may also have to manage payments for things like social security and healthcare and this will vary from country to country. That means withholding the right amounts from your employees’ pay and, usually, paying employer’s contributions too. Sometimes these are fixed amounts, sometimes they’re a percentage of each employee’s salary.
  3. Fines and penalties
    If you don’t pay the necessary taxes you could receive a heavy fine or other penalty, so it’s important to calculate the amount of PAYG, payroll tax and Superannuation Guarantee Contributions (SGC) owed and pay them on time.
  4. Reporting
    Employer obligations such as PAYG, payroll tax and SGC must be reported to the appropriate government agencies, and your employees, in writing. This might be done weekly, monthly or yearly, depending on local regulations.
  5. Payroll is for employees
    Your payroll legally includes the people you directly employ. It doesn’t usually include independent contractors or freelance workers, or anyone who invoices you through their own business. If you’re ever in doubt about who’s on your payroll and who isn’t, talk to your accountant.

In certain countries you may have other obligations too, such as paying funds towards unemployment cover, or checking that each employee is legally allowed to work in your country.

How to choose payroll software    

Some accounting software comes with payroll features built-in or as an add-on option. There are also stand-alone payroll applications available. Which one you choose will depend on the requirements of your specific business, but here are some points to bear in mind:

  • Work with what you have
    Does your business already use accounting software? See if it has in-built payroll or if you can add a payroll application to it. If not, it’s time to upgrade.
  • Find out if it is easy to use
    Choose a payroll package or payroll accounting software add-on that your accountant or financial advisor can also use. Keep it simple to avoid swapping files in different formats.
  • Go online and use the cloud
    These days it makes sense to use cloud-based accounting and payroll software. You can access your payroll information anywhere and at any time, and share information with trusted partners. Plus there’s less IT support work required.
  • Make sure it can grow with you
    You may only have one or two employees now, but no doubt you’re aiming high. With scalable payroll software you won’t have to change systems as your company grows.
  • Ensure it can do real-time recording
    Make sure the payroll application you choose keeps accurate, up-to-date, real-time records of payroll operations.
  • Get recommendations
    Ask your accountant or bookkeeper, financial advisor, bank, business partners and owners of similar companies to yours. See what they recommend.
  • Check the reporting requirements
    Check to see what types of report are available with your chosen accounting or payroll package. Ask your accountant which ones might be useful for your business.

As well as these ideas, look into other useful features such as automated calculations of taxes, direct deposit management and timesheet handling. Think carefully about what you’ll need and choose wisely, because if you get it wrong it can be hard to migrate from one payroll system to another.

A six-point checklist for great payroll    

Having the right software is only part of the payroll solution. Now you need to use it properly! Setting up your payroll system properly at the start can save you a lot of time and headaches later. Here are some guidelines:

  1. Register your business
    Ensure your registered business number is included in all your payroll documentation and any forms you submit to the tax office
  2. Record your employees’ data
    Enter all your employees’ information in your payroll system, such as their name, address, welfare ID number and deductions (if taxes need to be taken out). Also include contact details, salary, leave entitlements, overtime and any other compensation. Check local regulations to find out what data you must include.
  3. Do the paperwork
    Make sure your staff complete all necessary tax and superannuation forms and return them to the tax office. Do the same with your own forms.
  4. Decide on payment periods
    How often will you pay your employees? It might be weekly, monthly or fortnightly.
  5. Keep up to date
    Plan on having payroll information updated regularly. Do this yourself or get a bookkeeper or your accountant to do it.
  6. Set up an archive
    For records that need to be kept for several years, think about how you’ll archive them. Good payroll accounting software will do some of this for you but you’ll still need some paper archives for documents like tax forms.

Understand what to do when your payroll changes    

Your payroll isn’t fixed – it will vary as you hire new employees. Whenever a new employee joins your business, make sure all the correct government tax documentation is completed and filed.

Payments to the people on your payroll will vary too and you’ll need to include them in your system in different ways. Some examples include:

  • Salaried worker
    Paid a fixed salary for each pay period.
  • Regular hourly or casual employee
    Paid an hourly rate for a certain number of hours each week.
  • Commission
    Paid for services rendered, products or services sold, usually on a percentage basis.
  • Bonus
    Paid for good performance over and above expected levels.
  • Supplemental wages
    A catch-all term that includes bonuses, commissions, overtime pay, terminations and back pay.

Archive your payroll records    

The government will want you to keep payroll records for seven years. These records should include the following information for each employee:

  • Name, address and tax file number (TFN). Check this according to your country’s local regulations.
  • Date of hire
  • Date of termination (if not still employed by you)
  • Amounts and dates of all wage, annuity and pension payments
  • Copies of all relevant forms supplied to (and by) the employee
  • Details of sickness or injury payments, including dates, amounts and who made the payments
  • Dates and amounts of tax deposits you made
  • Copies of returns filed and confirmation numbers
  • Records of fringe benefits and expense reimbursements provided to your employees.

There may also be other information that you’re legally obliged to keep. Check with the Australian Tax Office (ATO) to find out.

Payroll is your responsibility to get right    

You might choose to handle payroll operations yourself in-house, or you might decide to outsource them to an accountant or payroll company. Either way, business owners are responsible for keeping accurate records and filing them with the tax office. So it’s important to take the time to get it right.

You can make life easier for yourself by choosing the right payroll accounting software and setting it up properly. Get whatever help you need from your accountant, the ATO and Fair Work Australia to make sure this is done properly. Putting in some effort now will save you tons of time and expenses as your business grows and you take on new employees.

Chapter 2: Getting your head around small business payroll

What does payroll mean for small business?    

At a basic level payroll is giving with one hand and taking with the other. You need to:

  • pay your employees the right amount at the right time, every time (according to their contract and in line with employment law)
  • make accurate deductions from their pay for things like tax and retirement

As you can imagine, there are a lot of rules around payroll. You have to comply with a lot of government requirements.

What’s involved in payroll compliance?    

To comply with government regulations, you must:

  • make accurate payments and deductions
  • provide your employee with a detailed payslip that shows what you have done
  • file and pay taxes on time
  • pay other deductions – such as retirement contributions – to the right places
  • hold onto payroll records for at least seven years

For this guide, we’ll assume you know how to work out your employee’s pay. We’ll take you through deductions and reporting requirements.

What are payroll deductions?    

Deductions are amounts of money you take from your employee’s earnings before paying them. Deductions cover things like:

  • contributions to employee retirement schemes
  • employee income tax, and taxes on benefits
  • payments such as child support

Your employees might also have arranged for deductions to come directly from their pay for additional healthcare insurance, retirement schemes, or charitable donations. You can learn more about these deductions – including the order you make them – in our guide to hiring staff.

Reporting to the ATO    

As an employer, you will collect taxes from your employees for the tax office. You need to hand over those taxes when scheduled, and file reports to the tax office on a regular basis. These reports show them you’re paying and taxing your employees correctly.

Under Single Touch Payroll (STP), you’ll report to the ATO every payday how much your employees were paid, how much tax was withheld and what contributions were made to superannuation. This report needs to be lodged through your accounting or payroll software, or you can get a registered agent or payroll service provider to do it for you.

Payroll options for small business    

The more employees you have, the more complex your payroll usually gets, especially if you have a mix of employees on hourly wages and salaries. Throw in some contractors, staff on commission, overtime, expense claims, allowances, and leave entitlements, and your payroll can be different every time you run it.

There are different ways of handling your small business payroll:

  • Pen and paper, or spreadsheets: These methods are preferred by businesses with a handful of employees. However spreadsheets are often not accepted by the tax office.
  • DIY software:  Apps can calculate pay and deductions and even fill out tax forms for you. You’ll need to make the payments yourself, however.
  • Payroll service providers: You can outsource your payroll to experts. Some providers will do absolutely everything for you. Others will help with specific tasks.
  • Accountants and bookkeepers:  You don’t have to go to a specialist payroll company. Many accountants and bookkeepers can do payroll for you. Check out the Xero advisor directory to find one.

Chapter 3: What is single touch payroll and how does it affect your business?

Summary of single touch payroll    

Single touch payroll is a recent regulation that changed when and how small businesses report payroll activity to the Australian Tax Office (ATO).

Businesses used to report this information to the ATO once a year. Now, they send a report after each pay day. And those reports must be submitted digitally, using a very specific format.

When you report payroll    

Small businesses used to finalise their payroll records at the end of the financial year and produce:

  • a payment summary annual report for the ATO, stating how much the business had paid in salary or wages, the PAYG withheld, and some superannuation contributions they’d made
  • a payment summary for each employee, stating what each employee received in wages or salary, the payroll taxes collected from their pay, and some superannuation contributions made on their behalf

With STP, the payment summary annual report and the payment summary have gone away.

No more payment summary annual reports    

Because you  update the ATO on a pay-by-pay basis, you don’t need to prepare a payment summary annual report anymore. You just let the ATO know when you’ve made your last pay run of the financial year for your employees.

No more employee payment summaries, either    

Payment summaries don’t need to be sent to employees anymore, so employers aren’t required to produce them. The ATO uses single touch payroll reports as the sole record of salary/wages paid, taxes collected, and superannuation contributed.

Your employees can see the information that used to be on their payment summary by logging on to myGov.

You need to report payroll online    

There are no more paper forms for reporting your payroll activity to the ATO. You need to submit the information online, using a specific format known as SBR (Standard Business Reporting).

Employers with 1–4 employees are eligible to use the no-cost or low-cost solutions the ATO have asked software developers to build. These solutions should cost $10 per month or less. These businesses can also choose to get a registered tax or BAS agent to report quarterly on their behalf – up until 30 June 2021.

How to comply with single touch payroll    

You  need to make sure you can submit compliant reports every payday. Here’s what it means:

  • If you use online payroll software, it should be able to handle the job. Just make sure it produces ATO-compliant reports.
  • If you use desktop payroll software, you need to find a service that can upload your payroll reports, convert them into the ATO’s required format and submit them on your behalf.
  • If you use spreadsheets or pen and paper, you need to find a service to convert the data into a compliant digital report format and submit it on your behalf.

If you don’t already use an accountant or bookkeeper, this could be a good time to start. You can find one that’s familiar with online payroll software, in the Xero advisor directory.

Chapter 4: How to record payroll taxes accurately

Saving-Money

Your employees pay tax through you    

As a business, you pay tax on the profits made by your organisation. But that’s not the end of your tax liabilities. You also have to collect tax from your employees on the money they earn.

Each of the staff members you employ is taxed on their income. The amount of tax will vary depending on their salary and a range of other factors.

However, your employees don’t actually write cheques to the government tax office each month. Instead, you collect (withhold) and pay their tax for them.

So it’s important to keep accurate payroll tax records. In this guide we’ll look at what’s involved in doing that.

The importance of keeping records    

Keeping accurate payroll tax records is a legal requirement. When you collect taxes from your employees, in legal terms you are acting as a fiduciary agent of the government.

This is one of your obligations as a business owner, and there are serious penalties for failing to do it properly. Expect a government audit if you don’t follow the rules carefully.

But even if there were no penalties, it would still be important to keep comprehensive records. Accurate numbers can tell you a lot about the state of your business.

They let you know in detail how your money is being spent. They also tell you how much each employee is costing you in real terms – not just the cost of their salary.

What should you record?    

Different tax authorities will have different requirements. But all of them will want some essential information. Luckily, that information is also useful for you in running your business. For example:

  • Details of all employees, including names, addresses and social security numbers.
  • Start and end dates of the payroll tax reporting period.
  • Full details of salary payments made during the reported time period.
  • Additional payments such as pensions, benefits and superannuation contributions.
  • Any payments such as goods or services you provide to your staff instead of money.
  • Expenses incurred by and paid to your employees – including all receipts.
  • Any maternity or paternity pay, as well as sickness pay.

In short, anything of monetary value that you pay or give to your employees should be recorded. It all affects their income and the tax you need to withhold.

Looking after your records    

Keep all payroll tax information safe. In most countries it must be kept for four years or more, but check local laws to be sure.

It doesn’t matter how you store the information, as long as it the storage method is secure and reliable.

Many companies use cloud-based accounting software for this. Their information is automatically encrypted and backed up remotely. That gives business owners greater peace of mind.

Simplifying the work with online payroll software    

Payroll tax recording used to be done by hand, using pen and paper. This was time-consumingand laborious. Luckily you can now use good payroll accounting software to do most of the work for you.

The big advantage here is the ability to tie different systems together. That’s especially true if you’re using cloud-based software. That means that the application runs online, and can share data securely. So you save time. For example:

  • Employee time-tracking can be handled electronically, not on paper time-sheets.
  • Tax codes are updated automatically.
  • Employees can help you. They can keep their own contact details updated and apply for holidays through the system.
  • Travel and expenses claims can be processed much faster.
  • The software can calculate payroll tax for you, using up-to-date tax rules.
  • You can access your information securely from anywhere at any time, using a laptop, smartphone or tablet.

All of this takes the struggle out of payroll record-keeping. It will also help when you come to file your reports with the tax office.

Filing online – a choice or requirement?    

Governments are trying to make payroll reporting easier for businesses – and for themselves. Many now offer online tax report filing as an option, and in some countries it’s mandatory.

Reporting periods are getting shorter too. Businesses used to have to file reports every quarter or every year. Now some authorities require you to file reports every time you pay an employee. It’s important that your payroll records are accurate, whenever you file them.

This sounds like a lot of work for business owners. But with the right payroll accounting software it’s easy to keep track of the important numbers.

Accounting software companies work hard to connect to government tax systems. Cloud-based payroll accounting software is updated regularly and automatically. So you’ll always have the newest reporting tools to file online.

Better business insight    

Never forget the value of payroll tax records to your business. They’re based on information that you should be collecting anyway. But they can give you a different perspective on your business.

Understanding the amount of tax you’re withholding helps you understand the true cost of each employee.

  • Reports help you focus on areas where you can cut costs without damaging productivity.
  • Expense claims might show you where you can save money. Perhaps you could offer different travel options to your staff.
  • If sickness pay is high, maybe there are ways you can improve the working environment of your staff.

You can’t rely on payroll tax records to tell you everything about your business, of course. But they can give you a different insight into what’s probably your biggest business expense – your staff.

Don’t forget to pay!    

You need to ensure that withheld taxes are paid on time, every time. We’ve mentioned that there are penalties for failing to keep accurate records. But there are also penalties for failing to pay the right amount of tax on behalf of your employees.

Those penalties increase the later you pay. So make sure you set reminders for payment dates in your accounting software. Then you’ll never miss a payment.

Part of good business    

As you can see, keeping accurate records is important. The information will help you keep track of what you’re paying your employees. It will also ensure you withhold the right amount of tax. Doing this properly will keep you on the right side of the law.

If your payroll tax records are accurate, it’s a good indicator that your business is running well. So take the time to put the right recording system in place. Then you’ll stay compliant with tax law – and have great insight into your business.

Chapter 5: Payroll compliance for an employee’s first day

Compliance is a legal requirement    

Before your new employee even arrives for their first day, there’s a lot to do. Most of the HR work will have been completed – contract signed, files updated. Now the focus is on payroll.

As we’ve discussed in other payroll guides, there’s more to payroll than just paying your staff. Payroll covers hiring and firing, salary, leave dates, benefits, bonuses and other topics.

It’s also directly linked to taxes and tax accounting. That means it’s covered by legislation. So if you don’t follow the law exactly, you could be prosecuted.

And it’s not just tax law. From completing the right forms to making the correct overtime payments, payroll is covered by laws every step of the way.

In this guide we’ll look at what payroll compliance involves. That way you and your new hire will be able to hit the ground running.

Start with the basics    

The first thing to do is add the new employee into your system. You may have stand-alone payroll software. Or it might be incorporated into your main accounting software. Either way, you need to cover the basics:

  • Confirm that the new hire is an employee of your company. If they’re an independent consultant or contractor they’re not your employee.
  • Check all personal details. Including date of birth, address and marital status. This affects the way an employee is treated for tax purposes.
  • Make sure the correct salary information and tax codes are used. Include any contractual bonuses and benefits – these must be declared for tax purposes.
  • Input the correct working hours. Get these right for the new employee – part-time or full-time, flexible or fixed hours.
  • Make sure you have the correct bank account details. Check this in writing with your employee. If you use the wrong information you could end up paying the wrong person. And that can be expensive to put right.
  • Set the new employee’s details to go live on their start date. Make sure their payment dates are correct too – they are probably the same as everyone else in your business.

Enrol your new employee    

In some countries it’s a legal requirement to enrol new staff members into your pension or superannuation scheme.

In other countries it’s optional, but many employers do it anyway. It can be a tax-efficient way to make your business more appealing to potential job applicants.

It can also be a compliance minefield. Contributions from you and your employee will vary depending on their age, seniority and salary. Any mistakes can have consequences long into the future.

Government websites often have useful advice. Check them first and you’ll get an idea of what’s required to run your own scheme properly.

Think about the details – five questions to ask yourself    

We’ve mentioned the basics of payroll compliance that apply to all companies. But there are some issues that will apply only to companies like yours. For example:

  1. What is your staff turnover?
    In some fields of business, casual or temporary staff might be present for just a matter of weeks. In others you might have the same employees for many years. Different situations mean you’ll need to focus on different aspects of payroll accounting.
  2. How do you handle expenses?
    Whether it’s travel claims or entertainment, check the local laws governing employee expenses. Some things are allowed, others aren’t – and the differences won’t always be obvious.
  3. Do you pay your employees in cash?
    It’s rare these days, and most tax offices try to discourage it. But there’s nothing wrong with paying your staff in legal tender. This means you’ll need extra security, though. It also means your accounting systems must handle cash accounts.
  4. Do your employees do overtime?
    This must all be accounted for, especially when it happens during weekends or public holidays.
  5. Do you fully understand local legislation?
    If you employ people in different countries, you have to pay them according to local laws. Make sure you’re up to speed with things like minimum wage, employee tax reporting, and maternity and paternity leave.

These are just a few of the finer points of payroll compliance. If you have any doubts, get professional advice. Business advisors, local chambers of commerce and accountants are all good sources of advice.

Always talk to your accountant    

You may have discussed your new hire with your accountant already. In fact this new employee may be part of your business plan, drawn up with your accountant’s help.

Alternatively you might have got this far without the advice of an accountant. In that case it’s never too late to hire an accountant.

Unlike most business owners, accountants have to stay up to date with accounting laws. That includes compliance. This means your accountant should have a much deeper insight than you do.

When it comes to hiring new people, an accountant can check that you’re doing everything right. If there’s anything unusual about your business situation, your accountant is the one who can tell you – and help you fix it.

Consider outsourcing payroll    

You could outsource the work to a company that specialises in payroll. This is quite common for businesses with up to 50 employees.

It can save you time and overheads, but it doesn’t solve every problem:

  • You will still have to provide accurate information about your new employees.
  • You will be one step removed from the person working on your payroll, which makes it harder to check.
  • Even if you outsource payroll, it’s still your legal responsibility to get it right.

There are pros and cons to this approach. Think carefully before deciding whether outsourcing payroll is best for you.

Use payroll software that helps you    

If you’ve decided to keep it in-house, make sure you use software that helps simplify the work. It should be:

  • Easy to use
    Check customer reviews and discussion forums, to find out how intuitive it is.
  • Suitable for your location
    Make sure it can be set up to comply with local laws.
  • Connected to your accounting software
    You don’t want to have to enter the same information twice. Some accounting software packages have payroll built-in, others have it as an option.
  • Cloud-based
    If the software is online, you can access it from anywhere at any time. And this means it will always be up to date and your accounting data will always be safely stored.

Ask for recommendations from business associates, accountants and suppliers. Don’t rush the decision, because good payroll software will stay with you as your business grows.

Talk to your new employee    

When your new hire turns up for work, there are basic things you’ll need to talk to them about. These include introducing them to colleagues, discussing health and safety and showing them around the office.

But make sure you talk to them specifically about compliance too. That includes their responsibilities, such as:

  • informing you if their personal situation changes in any way (such as address or marital status).
  • keeping all receipts for allowable business expenses and travel costs.
  • maintaining records of any overtime they do. This is your responsibility too, but it helps to double check.
  • fulfilling any obligations in their employment contract with you.

Compliance makes life easy for you – and the tax office    

One of the biggest problems small businesses have is complying with employment legislation. That’s especially true of payroll. So don’t be afraid to get help. Ask for advice, and choose the right software if you’re not outsourcing the work.

Compliance starts on the first day of your new employee’s work – if not earlier. Get the payroll aspect working smoothly, and it’ll save you headaches later on.

It will also make things easy for the government – the tax office in particular. Payroll compliance means you’ll have all the information you need to complete and return tax forms on time.

So compliance will save you time and money. That’s true from day one right through to the end of your new employee’s time at your business.

How payroll accounting software benefits your office

Payroll is more than just payment    

Payroll covers more than just a list of people you employ and what they are paid. It’s also about the tax information and complying with legal requirements, such as Single Touch Payroll.

Most payroll guides look at this topic from the perspective of the business – such as what it can do for you and how you can ensure you comply with relevant laws. Those are important issues, of course, but there’s more to it than that. Each name on your payroll is a person. If you treat them as an accounting ledger entry and nothing more, you might miss an opportunity to understand their needs. As a result, your business could risk underperforming.

So in this guide we’ll take a broader look at payroll, to give you a better idea of what your employees require. With this knowledge, you’ll be able to optimise your payroll process – and get more from your employees.

Understanding employee motivation    

As a small business owner you probably have two main motivations or goals. The first is to earn enough money to keep your business going. The second is to grow your business as fast as is sensibly possible.

Your employees’ motivations and situations are often quite different to yours. Here are some points to consider:

  • They don’t own the business, so they won’t be the ones making a large profit when (or if) you sell it.
  • They have their own career paths and personal goals.
  • They may only work in your business for a short period of time.
  • They may not have financial stability and need regular pay-cheques to get by.
  • They have monthly costs such as rent, food and utility bills to consider.
  • No matter how much they love your business, they are still working for you with the goal of getting paid.

So it’s clear that one of the biggest motivators for your employees is money. Not money at an unspecified date in the future – but money at regular and set points every month. That’s why an efficient payroll process is vital for your employees.

Give your employees what they need    

Nothing disrupts working life and staff morale like an unreliable payment system. If your employees are paid regularly, on time and with all administration completed properly, they will be happier and more efficient workers. So if you want your business to run smoothly, you need a payroll accounting system that looks after them:

  • Automated direct payments
    Peace of mind comes from knowing that a bank deposit will be made on the day it was promised. So don’t keep your employees waiting for their salary. Direct automated payments will ensure that there are no delays.
  • Fast updates to tax codes
    Your employees’ tax codes can change. Sometimes that’s due to new legislation affecting their income tax band. Sometimes it’s due to changes in personal circumstances, like marriage or parenthood. Your system should update tax codes quickly and easily.
  • Accurate tax information
    Most employees have income tax deducted from their salary before they receive it. That’s your job as employer, and it’s important to get it right. If you deduct too much, your employees may not have enough money left to live on. If you deduct too little, they may have to make a lump sum payment to the tax office at the end of the year, which could cause them financial hardship. As well as the moral requirement to get these deductions right, there’s also a legal one.
  • Let your employees help
    As your business grows you may have dozens of employees or more. Each time they move home or change their personal status, that information must be updated in your system. It makes sense to give employees limited access to their own information, so that they can make changes directly. This should cut down on mistakes, and you can set it up so that any changed information is checked before it’s updated.
  • Manage holiday accounting
    Your payroll system should keep track of the number of days each year that an employee has been on leave, along with their total leave allowance and any carry-over from the previous year. You can improve workflow efficiency by letting your employees apply for leave directly within the system. Their applications can then be approved or denied by their manager, without excessive paperwork.
  • Process expenses and travel claims quickly
    These are costs that are incurred by your employees but chargeable to your business. Make sure your employees are reimbursed as quickly as possible – this saves any potential stress.
  • Make regular healthcare, pension or superannuation contributions
    These payments may not be very large, but they add up over time – and so do any errors. Good payroll accounting software will take care of these payments automatically. Benefits, overtime and sickness pay should also be handled quickly and efficiently if you want to keep your employees happy.

Choosing the right payroll software    

You need a system that can handle the points listed above. But good payroll accounting software can do more than that:

  • Simplify tax paperwork
    Tax paperwork is unavoidable if you run a business. Good software will make it as simple as possible, by linking into your accounts and retrieving all the necessary information at once. Then all you need to do is check it and submit it – usually online.
  • Take care of new employees and ex-employees
    A few clicks should be all it takes to handle paperwork and payments for employees leaving your business. It’ll be a little more complex when new people join, but good payroll software will take you through the process easily.
  • Reduce IT costs
    The best software is one that you don’t have to worry about. No in-house support costs, no expensive upgrades and little to no downtime. By using online payroll accounting software (sometimes called cloud payroll software) you can stop worrying about IT issues, because it’s all taken care of remotely.
  • Give you access from anywhere
    Online payroll accounting means your data is stored securely and you can access it online, from wherever you are. So you don’t need to be in the office to approve staff payments or check the monthly payroll figures. You can do that from anywhere, at any time, using a laptop, tablet or smartphone.
  • Stay up to date
    Tax laws change, income tax rates vary, and employee benefits law isn’t set in stone. Quality payroll software can make life easier for you by incorporating changes when they occur, and rolling them out to your employees.

Take your employees’ needs into account    

When it comes to payroll, what’s good for your employees is also good for you. In recent years there have been several examples of payroll software going wrong – and the effect on staff morale can be devastating. Some organisations never fully recover.

So don’t underestimate the importance of payroll to your employees. By choosing the right payroll accounting software you can make sure your employees are all paid the right amount of money at the right time.

This will help keep them happy and let them concentrate on doing their work. And that will help your business to grow and thrive.

Chapter 6: Payroll outsourcing: what you need to know

What is payroll outsourcing?    

Like most jobs you don’t want to do, or can’t do, there are specialists who will take payroll off your hands. Payroll providers can do everything from calculating pay and deductions to transferring money into your employee’s account and filing associated taxes. Or they might just do part of the job, depending on what you need and what you can afford.

Why outsource payroll    

Running payroll can be complicated and time-consuming. Plus there are a lot of legal requirements, which means there are serious risks to getting things wrong. For these reasons, many business owners prefer to leave it to the experts. It gives them more time, and extra peace of mind.

In addition, payroll providers are often able to do your payroll at a relatively low cost as they use software to automate many of the tasks involved.

What do payroll providers do?    

Payroll providers may offer different levels of service which you can choose depending on what you need. But they’re generally all capable of:

  • working out pay (including benefits and reimbursements)
  • deducting employee income taxes and, if applicable, payroll taxes
  • making any other deductions, such as retirement contributions
  • filing (and even paying) taxes with the ATO
  • making payments to employees
  • keeping payroll records

Types of payroll service    

Payroll service providers come in many shapes and sizes. They can be accountants or bookkeepers, or specialist payroll companies. Some providers may be better at dealing with small payrolls, while others target big businesses.

They also differ in the level of service they provide, and the way they deliver it.  There are two broad categories.

1. Full-service payroll provider    

A full-service payroll provider manages your payroll from start to finish – all you have to do is supply them with your business and employee data. They look after everything else.

Full-service payroll is generally easier but, as you’d expect, it costs more. You also need good systems in place for sharing information. They need timely access to timesheets (for hourly workers), and notice of changes to a worker’s employment terms or tax status.

2. DIY payroll providers 

Many providers do the toughest parts of payroll, while leaving basic admin to you. For example, you might record time and attendance, and keep employee records. But they’ll calculate all the pay, taxes and other deductions. And they’ll set you up with software that makes your tasks straightforward.

How to choose a good payroll service provider    

Payroll is a critical part of your business. You’ll want to get it right and opt for a provider that meets your needs. Here’s what to consider when choosing a payroll provider:

  • Get the right level of service
    Make sure your provider delivers the right level of service – you don’t want to be paying for what you don’t need. Understand what you’re paying for, what you’ll need to handle in-house, and what you’ll pay for extra services.
  • Automate the easy stuff
    Be sure your provider is using software to automate the easy stuff so you’re not paying professional fees for basic admin jobs.
  • Check employee details regularly
    Ask what processes they have for checking and updating employee information. A change in an employee’s details may affect deductions and legal requirements, so providers must be vigilant about updating them.
  • Secure your data
    How does your provider handle the privacy and security of your business and employee data? Ask them what safeguards are in place to ensure your data is secure.
  • Work with what you have
    Check out what your accounting software can do. You may already have the means to automate payroll – maybe you just need help from an accountant who’s familiar with the software you have.
  • Work with who you know
    Don’t forget that some accountants and bookkeepers are payroll providers too. Ask your accountant or bookkeeper if they provide payroll services.

Outsource payroll the right way    

With payroll outsourcing, it often comes down to what’s most efficient and cost-effective for your business. It pays to do your homework and assess your business needs before making a decision. If you get the right provider, you’ll spend less time thinking about payroll and more time doing what you do best – running and growing your business.

Chapter 7: Setting up online payroll with your bank

Business-Payroll-Melbourne

Payroll doesn’t stand still    

Payroll processes are evolving all the time. Over the years businesses have moved to new payment systems. Historically, employees have been paid with:

  • cash payments
  • handwritten checks
  • printed checks
  • manual direct deposits into employee bank accounts
  • online direct deposits into employee bank accounts.

So the obvious next stage is to automate the online direct payment of your employees. Modern businesses use software to connect to their bank accounts. Then they can set up automated payments for their staff – and do other useful things too.

Linking your business to your bank    

Your bank account is an integral part of your business. You make and receive payments every day. So it makes sense for your bank account to be closely tied to your business software.

Modern accounting software can link to the internet banking facilities of most major banks. This lets you manage all aspects of your money, without even entering a bank branch.

For example, good accounting software can take a “bank feed” from your bank. A bank feed is a way for you to see your bank transactions when you log in to your accounting software. It’s a quick way to match bank transactions and reconcile your accounts almost effortlessly.

You can also make faster payments to your staff, without having to enter all the details manually. Online payroll is good for your employees – and good for your business.

How does it work?    

Online banking is covered by strict regulations and tight security. Bank account holders need to know that their money is safe at all times. So banks and accounting software companies work hard to ensure that online payroll is secure.

There are two simple ways to make secure online payroll payments:

  1. Your accounting software creates a payment file. This contains payment instructions in a form that your bank understands. Log in to your online banking and upload the file. Then simply confirm that you want to make the payments – and off they go.
  2. Your accounting software sends payment instructions directly to a trusted payment company like your bank. That company pays your employees for you, and you make a single payment to the company.

Both methods have their advantages, but the second is particularly quick and easy. You can control the whole operation from within your accounting software, and you’ll only have to log into your bank account to make a single payment.

Connect to your account    

It’s simple to get automatic bank feeds from your bank once you connect it to your accounting system. Your bank statement lines are fed into the accounting software so that you can match them and then reconcile them with your records.

Your accounts will be updated automatically with all your recent banking transactions. You won’t have to type anything, saving you a lot of time and effort.

Quality accounting software will let you have direct feeds from most major banks. You may need to sign a form giving the company authorization first. You may also have to pay a small fee to the bank. But it’s worth the cost, because of the advantages it brings.

A bank connection makes it easier to do business    

Simpler payroll is just one of the benefits of linking your accounting software to your bank. Being able to access bank feeds containing updated information gives you lots of flexibility. Some of the other advantages include:

  • much less manual work – your financial information is updated automatically
  • faster accounts reconciliation through bank feeds
  • less chance of typing mistakes or other manual errors
  • you get an accurate, real-time view of your accounts
  • you can access your bank data from wherever you are
  • you can make and schedule payments quicly and easily
  • you’ll have happier employees and suppliers, because you can pay them faster.

Anything that simplifies accounts reconciliation and payroll payments is good for your business.

Choosing the right software    

If you want to connect to your bank to get the benefits of automated payments and feeds, you’ll need the right software.

Accounting software packages work in different ways – and with different banks. Make sure you choose the software that’s going to work best for you. It should have these features:

  • Support for bank feeds and account reconciliation
    Ideally this should be automated, so you don’t have to manually download the data from your bank account.
  • Support for payment data files
    It should be possible to create standard format payment data files that you can upload to your bank.
  • Accessibility
    With online or cloud-based software you can access your accounts securely, whether you’re in the office or elsewhere. It means you’re not tied to one computer when you want to manage your online payroll.
  • Ease of use
    Accounting can sometimes be complicated, but your accounting software should make life as simple as possible for you.
  • Payroll features
    You can’t pay your staff automatically if your accounting software can’t handle online payroll operations.
  • Scalability
    As your business grows, so will your payroll – because you’ll have more employees. You need to make sure your accounting software can handle this growth.
  • Low maintenance
    You won’t want to have to keep applying upgrades and patches to your accounting software. Ideally it should be cloud-based – that usually means the upgrades and backups happen automatically.
  • Single Touch Payroll compliance
    You will need to submit reports to the ATO each pay day. It can be a lot of admin, so look for software that allows you to create reports automatically and submit them online.

Better online banking – six aspects to look for    

Some banks have a traditional, old-fashioned approach to business banking. Others are more modern and proactive and have adapted to the world of cloud-based applications. So once you’ve identified a potential business bank for your online payroll needs, it’s time to dig a little deeper. Here are some things to look for in an ideal banking partner:

  1. Support for your chosen accounting software.
  2. Simple sign-up process, where they walk you through each step.
  3. Comprehensive and easy-to-use online banking tools. You should be able to access your accounts via a web browser and also smartphone and tablet apps.
  4. Ability to connect to your accounting software.
  5. Ability to upload payment data files, if you choose that method of online payroll.
  6. A local presence. If anything goes wrong, it can be frustrating trying to resolve it via a telephone call to someone halfway around the world. A local branch lets you deal with any issues face-to-face.

It always pays to shop around. Check out customer reviews, and read each bank’s terms and conditions carefully. A good bank will stay with you for the life of your business – so this is not a decision you should rush.

Test and test, then test again    

Once you’ve chosen the accounting software and bank account that best suits your business, do some testing. Don’t try to do live payroll payments immediately. Take the time to understand how the process works.

Test your bank feed – check how well it integrates into your accounting software. Make sure the numbers make sense.

Then you can move to online payroll. Start with some test payments to make sure everything is working as it should. For example, you could pay a small amount to yourself or one employee. This would be a great first test as you can reverse the transaction and easily get the money returned.

It’s important that you are able to trust the connection with your bank. Any errors might be hard to fix later. So check the numbers regularly in the early stages. Make sure the automated processes are doing what they should.

Bank integration simplifies payroll    

Integrating your accounting software with your bank can make life simpler for you. As well as making your financial information available in real-time, it can make payroll faster.

It also reduces the risk of human error, and the time and effort required to keep your accounts up to date.

With a little work up front, you can improve the efficiency of your payroll operations. This will help keep your employees happy – and that’s good for business.

Chapter 8: Can payroll software actually save you money?

Payroll is vital for your business    

If you have staff, you need to pay them. This is called payroll – the managing of payments to your employees.

Some Australian small businesses choose to do payroll manually, keeping payment notes in a spreadsheet or other document. Others might outsource payroll to an accountant or bookkeeper, or even to a dedicated payroll company.

These are valid choices, but there’s another option. You can use payroll accounting software to handle your payroll operations in-house. In this guide we’ll investigate how that might work, to help you decide if it will save your business money.

What to consider for payroll    

Payroll isn’t as simple as it sounds. You have to pay your employees regularly, of course, but there’s a lot more to it than that. Small business operations might include:

  • Payments to your staff
    Dates and amounts must always be recorded.
  • Payment types
    There’s a difference between salaries, hourly rates, bonuses and commissions.
  • Taxation
    Make sure you keep the ATO informed of taxes collected on behalf of your employees.
  • Reporting
    Keep up with key Government reporting dates for employees’ pay and deductions.
  • Leave entitlement
    Track holidays taken by your staff, including any carry-over to the following year.
  • Sickness tracking
    Record all staff sick days.
  • Maternity and paternity payments
    A complex area that requires careful reading and understanding of government regulations.
  • Superannuation
    Note the amounts paid in by you and your employees.
  • Expenses payments
    What they were for, and how and when they were reimbursed?
  • Benefits and perks
    These must be accounted for in order to be properly taxed.
  • Significant dates
    Including dates of employment for new joiners and dates of termination for those who leave.

This is a lot to think about, which is why every Australian small business needs to carefully consider how it manages payroll.

The cost of compliance    

If you’re running a business in Australia then you need to know about compliance. This means keeping your business in line with government legislation and regulations. It includes taxation, reporting, employment laws and payroll.

Compliance takes time, and time is money – your money. This is particularly true for small businesses, where owners often have to juggle several different hats, such as director, bookkeeper, HR manager and sales lead. If you work out how many hours you spend keeping on top of Australian-specific compliance, the answer might surprise you.

So it stands to reason that anything that saves you time can also save you money. Quality software can certainly save you time. But can it save you enough time to offset the cost of buying it? We’ll look at that question next.

What is payroll software worth to your business?    

While some accounting systems come with payroll built in, other payroll software will cost you extra. The important question is whether that’s a price worth paying for your business. In other words, will payroll accounting software save you more money than it costs? Here are four questions to ask yourself.

  1. What will the software cost you?
    Research the market. Find out how much different software costs, bearing in mind some will require regular updates or monthly subscription fees. Some software lets you have unlimited extra users free of charge, which could save you a lot of money.
  2. How much does payroll work cost you now?
    This is the other part of the equation. One way to estimate this is to add up the total amount of time spent by you and other people in your business doing payroll work. Look through the list of payroll tasks earlier in this guide and add up the time you spend on them. Assign an hourly rate to this work. Multiply the two together and calculate the yearly cost of payroll-related tasks for your business.
  3. Will the software help your business stay compliant?
    When you have payroll and accounting as one solution, it reduces the risk of errors that are common with manual data entry. With automated and connected software you’ll have peace of mind knowing that you’re compliant.
  4. Why can’t I manage payroll on a spreadsheet?
    It’s common for businesses to use Excel for payroll, but spreadsheets are often riddled with errors. For people who know how to work spreadsheets to their full potential, these programs can perform highly complex calculations. But many small businesses forget that it’s a complex application and don’t restrict it to those with expertise. As a result, many organisations use spreadsheets to help with payroll and find it more difficult than they expected. With regulatory compliance factored in, your business will be susceptible to financial penalties if you don’t move from Excel to proper accounting and payroll software.
    You may also hurt the company’s reputation among employees if you continue to use a spreadsheet. There are a few reasons this may happen. One being that there are constant changes to complex regulations and any problems can cause issues between the business and the employee. Another is the fact that spreadsheets do not guarantee reliability. Unlike payroll software, your data will not be automatically backed up if you lose it.

Four key benefits of online payroll software    

There are numerous payroll packages available. Some are designed to run on a single office PC, but these days the newer packages are capable of running online, using the cloud. There are significant advantages to this, such as:

  1. Anytime, anywhere access
    If your computer crashes, all your data could be lost. There’s no such issue with cloud-based online payroll systems. Just log in from another machine and carry on.
  2. Multiple access
    Invite your bookkeeper or accountant into your payroll system to help manage it remotely from wherever they are.
  3. Data security
    If an office laptop is lost or stolen, all your vital payroll information might be lost. Or worse – financial details could be hacked, potentially leaving you or your staff out of pocket. Cloud-based tools use strong encryption to keep your data secure and online, reducing the chance of data loss.
  4. Work from anywhere
    Need to check some figures at the weekend when the office is closed, or while away on a business trip? No problem – just log in remotely at any time and access what you need.

So online payroll software can do everything that conventional products can do, but with the added advantages of the cloud. It frees you from your computer, your desk and even your office.

Choose payroll accounting software wisely    

Just as with any other type of purchase, it’s important to shop around to get the right payroll accounting software to suit your business. Some of the features that could be valuable to you might include:

    • Tax calculation features
      You won’t want to have to manually work out the tax owed for each employee. Make sure the software can do all this for you and that updates are automatically handled each new financial year.
    • Superannuation compliance
      The Australian Government SuperStream data and e-commerce standards can often make paying your employees’ superannuation a timely and involved process. Make sure your chosen payroll software can handle payments to multiple funds easily and automatically.
  • Full tracking and recording
    A complete audit trail of every transaction is vital in order to meet Australian compliance requirements.

  • Anytime, anywhere access
    Cloud-based software can be accessed from anywhere, using a laptop, smartphone or tablet. This helps you run your business from anywhere, at any time. If the software is fully cloud based, this also means less IT support work for you.
  • Multiple levels of access
    You might want to allow managers or employees to input their hours into the system (with checks), but keep all other details secure for your eyes only. Good online accounting software will let you do this.
  • Application and approval for leave
    Wouldn’t it be great if your staff could apply for annual leave using the payroll system, and you could approve it with a couple of mouse clicks? The best software will let you do this, saving time and paperwork.
  • Scalable architecture
    You probably want your small business to become a large business in time. So there’s no point buying software that won’t grow with you. Make sure to choose a package that can easily be scaled up to suit your growing requirements.

It’s important that the software you buy is easy to use and reliable. Check user forums and talk to other Australian small business owners to find out what they recommend.

So, can payroll software save you money?    

The answer is yes – but only if you choose wisely. The right payroll software will more than pay for itself in the long run, by reducing the amount of work you have to do manually.

So if you do your research and get the right software (preferably cloud-based), then you’ll be able to spend less time processing payroll.

That will leave you free to do what you do best – running your business and making it grow.

Chapter 9: Payroll software that makes things simple

Payroll technology is changing    

New technology isn’t just for consumers – it’s for businesses too. Changes in accounting technology are transforming the way businesses manage their employee payment processes. These new systems can revolutionise the way you pay your staff.

For example, they can simplify tax code updates, track staff hours and expenses, and make paper form-filling a thing of the past. They can also give your employees more control over their personal information. And that will reduce your costs.

There’s a lot to learn about online payroll technology. In this guide we’ll explain what you need to know. Then you can use that knowledge to simplify your payroll – saving you time and money.

How payroll technology works    

Not so long ago it was common for staff payments to be done by hand. Records were noted manually, cheques were written and handed out in person, and accounts ledgers were updated using a pen and paper.

Most businesses have moved on from that stage and use technology that lets them automate some of their payroll processes.

But technology moves fast. If your business is using software that’s more than a few years old, you could be missing out on some great new features. And those features could save you just as much time and money as the move away from pen and paper did. They include:

  • Better automation.
  • More integration with accounting software.
  • Personal information updated by your employees.
  • Simpler leave approvals.
  • Faster expenses claims using smartphones.
  • Improved tax calculations.
  • Real-time reporting for financial auditing.

If your current system lacks many of these features, it’s time to look again at the latest payroll technology.

Choosing the right payroll software    

Whether you buy an off-the-shelf package or use online accounting software, it’s the features that matter. Good software will stay with you as your business grows, so it pays to make the right buying decision. Here are some points to consider:

  • Compatibility
    To keep things simple, you need a package that will connect to your existing accounting software. If the two systems can integrate easily, you won’t have to enter information twice, or worry about file formats. Even better, some accounting software has payroll features built in, or available as an add-on extra.
  • Ease of use
    There’s no point in buying online software that’s complex and confusing – it will never be used properly. So check online reviews and customer feedback before buying. Good software will simplify your payroll workflow, not complicate it.
  • Scalability
    Perhaps you have just a few employees today, but next year you may have dozens. Will your software scale up as your business grows? The best packages will. And if the software is hosted online, you may get free upgrades without having to buy new versions of the software on a regular basis.
  • Compliance
    Payroll is covered by legislation, so you need software that complies with local laws. Make sure the software you buy is designed to work in your region.
  • Time-saving features
    This is what really separates good software from the rest. Payroll can be a complex, time-consuming business. Good software will save time by automating a lot of the work involved. So check the features carefully before buying, and read customer reviews and discussion forums for more detailed information.

Advantages for your employees    

Online payroll technology can make life easier for your employees. It can give them control over the way some of their personal information is stored. For example:

  • Change of address
    Employees can update their addresses within the system, without having to fill out paper forms and return them to your HR people.
  • Changes in life status
    Whether it’s a marriage, divorce or the birth of a child, employees can change their status directly. This can have an immediate effect on benefits and other payments.
  • Simpler leave notification
    Your employees can do their own holiday  or sickness leave notifications and applications. This is particularly useful for holiday time, because it makes it easier to manage all your team’s plans in one place.
  • Easier expenses claims
    New technology lets your employees scan their purchases using their smartphone or tablet. This means expenses can be recorded and approved straight away – so they get their money back faster.

All of this can be done without affecting the security of the system. New technology can give employees limited access, providing notifications to your accounts team so they can check and approve any changes.

From holiday approvals to personal address updates, new technology can simplify your payroll workflow – and reduce your admin.

Five key advantages for your business    

 

Some of the features that benefit your employees are also good for you, because they’ll reduce your costs. Quality payroll software also has other advantages for business owners:

  1. Less paper
    Paper on its own isn’t expensive. But printers, toner, electricity, maintenance, storage and archiving are all paper-related costs. New technology reduces the use of paper forms and tax submissions. It won’t give you a paperless office on its own, but it will help you use less paper.
  2. Automated bank transactions
    Depending on where you’re based, you can set up the system to handle direct deposits into your employee’s bank accounts – once payments are approved. At the same time, payment notification can be sent to employees, and tax records updated.
  3. Stay up to date with tax laws
    Tax laws seem to become more complex every year. With online payroll you can add new tax codes and make changes quickly and easily. Then you can roll out these changes to all your staff with very little disruption.
  4. Less admin
    From holiday approvals to personal address updates, new technology can simplify your payroll workflow – and reduce your admin. The big advantage here is that you can pass on much of the work to your employees. This gives them control over their personal information, so they have a vested interest in making sure it’s correct and up to date.
  5. Access information from anywhere
    With online accounting systems, you can get to your payroll information at any time, wherever you happen to be. This is a big advantage, since many business owners now spend a lot of their time out of the office. All you need is a smartphone, laptop or tablet and you can keep up to date – securely and easily.

Online technology gives everyone more control    

The main goal of online payroll technology is to give everyone more control. That means giving your employees control over their personal data and leave applications, and giving you more control over the way the process is run.

But don’t just buy the first payroll accounting package you see. This is a fundamental part of your business, so it pays to get it right the first time. Choose the right product for you – one that will simplify your payroll and grow as your business grows. With the right software, you can free up time and resources to concentrate on what’s really important – building your business.

Chapter 10: Payroll software for Mac that’s easy to use

Beautiful yet powerful design    

If you’re an Apple fan, one of the things you probably appreciate most is the outstanding product design. The glossy, lovable products created by Apple mask a huge amount of planning, hard work and attention to detail. Apple designs its software and hardware with usability in mind – and it shows.

But as a small business owner who loves Apple software, you may have found it hard to source payroll software you’re as fond of. Some payroll packages still leave a lot to be desired. For example, payroll software designed for PC users and then adapted for a Mac may not tick all the boxes.

So let’s explore what to look out for if you want payroll accounting software for Mac that’s truly intuitive, user friendly and powerful.

Seven must-haves for payroll software    

Apple products are popular with individual consumers, but they’re also popular in businesses. That’s especially true for modern, connected professionals. If you run your business using Apple devices, you’ll know what you want from your payroll software:

  1. A cloud-based or online payroll system that works seamlessly across your iPad, iPhone and Mac.
  2. Intuitive design – which is something financial software often lacks.
  3. Only the features you need – not bloated with ones you’ll never use.
  4. Stable and secure – because your accounting data is valuable.
  5. Outstanding customer service and reliability.
  6. Ability to share data and collaborate with other people in your business.
  7. Easy to connect to a range of add-on applications from third parties.

Those are the basic requirements to get you started. But what about specific accounting and payroll features?

Payroll software for Mac – seven points to consider    

Let’s say it’s possible to find payroll software that fits nicely with the Apple design ethos. That’s a good start, but it also needs to have the right features. You will need it to:

  1. Calculate your employees’ wages without having to enter the same data twice.
  2. Differentiate between a salaried employee and an hourly employee.
  3. Handle all payroll tax and the deduction of your insurance requirements.
  4. Prepare and electronically file all tax returns and other necessary paperwork.
  5. Integrate with other applications so you can share data securely.
  6. Add unlimited users and restrict access levels so that you and your team can collaborate online at the same time.
  7. Be accessible from anywhere at any time as long as you have an internet connection.

That last point is an important one. In today’s fast-moving business world, you need to be able to access your accounts while you’re on the move.

If you’re excited about using your payroll software and find it easy to use, you’ll be able to get a much better view of your financials.

Good payroll software makes teamwork and collaboration easy    

The ability to share information is vital for a modern business. Some software gives you the option to provide chosen users access to certain parts of the payroll process. You might want to share payroll data (but restrict the figures they see) with these people:

  • Your employees
    Employees can enter their own information when you use modern payroll software. They’ll be able to enter in their own hours and access historical and current payslips. They could also apply for holiday time through the system.
  • Your bookkeeper, accountant and financial advisor
    Would you want to print out financial summaries every time you go to talk to these professionals? No – it’s much simpler and faster to securely share the data online. With the right payroll software, you’ll also be able to collaborate with your accountant on the process of running payroll, filing or paying taxes.

Finding the right payroll software    

Now you have a pretty good idea of the features you need for the best payroll software. But how do you find the right one for your business?

Start with online reviews of software packages. Look for ones that will suit your business needs. Check customer reviews too – these are a great way to find out what people really think.

Don’t be afraid to ask colleagues, partners, suppliers and friends what they use. You’ll get plenty of recommendations, which will help you narrow down your choices.

Time-saving tools    

You can refine those choices even further by thinking about how software can save you time – and therefore money. The best payroll software for Mac will handle admin tasks for you. It should be able to:

  • calculate and allow you to electronically pay taxes
  • incorporate time sheets to improve productivity and simplify calculations
  • handle direct bank deposits to your staff
  • prepare forms for filing, including end-of-year tax forms for employees
  • include a calendar for employees’ holidays, days off and birthdays
  • offer collaboration with your accountant, so they can check your figures remotely
  • automatically update data into the general ledger of your accounts.

The more care you take when choosing payroll software, the better you’ll feel about your final decision.

Payroll without compromise    

When it comes to payroll software for Mac, you can have simple-to-use software with all the tools you need – and more.

Make sure you look for cloud-based or online payroll software and check user reviews. Several payroll software systems will give you a free trial, so you can decide whether it’s the right package for you.

If you’re excited about using your payroll software and find it easy to use, you’ll be able to get a much better view of your financials. And being in control of your finances and cash flow has got to be good for business.

 

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