Payroll Processing: What's All The Fuss About?
There has always been an unexplained complexity rumored about certain functions performed in the corporate establishments. Out of all, payroll processing is considered as the most intricate task in a company. In fact, it is said to be one of the most challenging operations of the HR department. But, is all the commotion built up around this domain really worth it? Take other processes into account and you will see that no function involved in the workflow of an organization is any less preoccupying.
Every business requirement is fulfilled with an activity which then requires support to proceed smoothly. Be it the hiring and onboarding of a new employee, attendance tracking, performance management or any other execution, high efforts are needed. Since technological advancement is at its peak, HR solutions are all over the market. Similarly, the payroll software has also simplified more than half of the challenges. So, what makes people think that payroll is more convoluted? And why is it just a myth?
Let us first walk through the common presumptions that a layman makes about payroll processing:
There is too much paperwork and data management issue
You cannot make changes once the process is established
Payroll processing simply means salary calculations
Anyone can perform the payroll operations easily
There is a different process to manage taxes
Now, we will bust the payroll-related myths by walking through the functions a robost payroll software has automated, thereby removing the ‘fuss’ factor from it:
The earnings and reimbursements are added, deductions, taxes and other expenses are cut to give the final net pay. The calculations done using the payroll solution are quick and accurate. Therefore, the monthly salary that is calculated using this automated system is fair and timely.
As the payroll is processed, all the statutory deductions including Employees’ Provident Fund (EPF), Employees’ State Insurance (ESI) and TDS, etc. are automatically made. Then the post-payment formalities are done like filing returns/reports, generating ECR among others. Moreover, the compliance is maintained as per the latest government policies, labor laws and corporate guidelines. The tax-related actions are also taken using the software.
An HR software in India is developed such that the salary is timely deposited in every employee’s account based on the payout cycle of the company. Now, all the means of transfer - cash, cheque and bank transfer are kept into consideration. Once the payroll system is designed, it is ensured that the concerned bank account of the company has enough funds. After that, the advice statement is provided to the bank with all the employees’ details in it. After the transfer of money is successfully completed, you can publish the payslip and tax slip on the employee self-service portal of the software.
Recording employee compensation such as salary, incentives, bonus, commissions and gross wages is also one of the processes that payroll software controls. Also, the withholding of payroll taxes is also kept in the book of accounts. The salary/payment-related data is fed in the database or ERP system.
Reporting and Documentation
To maintain the record for business purposes, after the salaries go into the respective employees’ accounts, the time comes to maintain the reports. Department or team-wise cost, location-dependent expenditure, and data for other charges are maintained in the database. So, paperwork is reduced to zero as every big-little information is on the system. If and when the time comes to show the documents, you can check the software and produce the same. You can even use the data for prediction analysis.
In a nutshell..
How difficult and inconvenient payroll operations used to look like is history now. Today, HCM solutions like HROne are making wonders. Besides mechanization of payroll activities, the cost-effectiveness, user-friendliness, auto-updated compliance, etc., are the added perks of using a payroll management software. The tasks that seemed complex earlier are untangled to a great extent now. So, what’s all the fuss about?