Did you know the payroll software market is expected to reach $ 9340 million by the end of 2025?
While the use of these tools is rising, committing to payroll is no child’s play. It requires a professional accounting team and a software solution to meet all legal requirements and keep errors at bay.
Even a small error during payroll processing can bring several penalties under the Income Tax act. With ever-changing amendments and rules, it can become difficult to keep everything under control.
To help you deal with payroll processes smoothly, we have compiled a list of 8 must-have features in your payroll system. Before we get to it, let us understand what payroll is and how it is performed.
What Do We Mean By Payroll?
The process of calculating and providing salaries to employees and workers is known as payroll. It involves different pay methods, including monthly salaries, weekly payments, and hourly wages. While freelancers are usually paid on an hourly basis, full-time employees are mostly paid monthly.
How Is Payroll Performed?
An effective payroll processing system includes wage calculation based on attendance management, worked hours and days, PF and professional tax calculations, and many more. All these need to be calculated and updated. Once this is done, the final payable amount is calculated and transferred to the employee’s account.
Several intuitive HR software and payroll solutions are available in the market. They can help you streamline activities and automate major parts of payroll calculation.
Many companies have already started adopting reliable payroll software to automate monthly payments, leave calculations, and expenses.
Features Of An Ideal Payroll Software
Let us have a look at the most important features of a payroll management software and its benefits.
1. Provides Integration Capabilities
Most of the payroll software comes with integrated attendance modules that help HR and accounting departments in payroll calculations.
Attendance management modules help in tracking the total worked hours. Moreover, data integration brings all the required data in one place. Thus, resulting in a smooth calculation-free payroll for businesses.
Furthermore, automated pay calculation makes the administrator’s job easier and takes less time to complete. It can be achieved in a few simple clicks, thus, simplifying the entire process.
2. Automated Tax Calculation and Management
A well-designed payroll management software has its own tax management tools. Automated tax calculation leaves no scope of payroll errors. Cloud-based payroll systems ensure that taxes are filled in time by employers and employees. You can save your company from tax fines by implementing an automated payroll solution.
3. Eliminates Compliance Issues
An effective payroll software will streamline your work and ensure you do not get stuck in penalties and law violations. Compliance rules keep changing now and then, which makes compliance management tricky.
Thus, a payroll solution you choose must be able to deal with compliance issues. Picking a reliable vendor can keep you away from fines.
Moreover, you must ensure that it keeps you updated on the latest tax changes, allocation rules, government tax guidelines, and much more.
4. Leverage Cloud Compatibility
A system available on a cloud server will simplify your processes and provide a high level of data security. A third-party server offers the best data backup and ensures data safety in all instances.
Another benefit of cloud-based payroll systems is that they can generate payslips and invoices. Your employees can easily download the reports through their mobile phones. Moreover, such systems serve as excellent remote work solutions and can be used to track employee performance.
Also, cloud payroll software can be integrated with a self-service portal. This should be done to get easy access to attendance data, HR data, download payslips, and process reimbursements.
Moreover, a self-service portal can help employees request leaves by phone without bothering their team leaders and HR managers.
Thus, a cloud-based payroll system is ideal for both in-house and remote workers.
5. Manage Invoices
Expense handling and invoice management are the two most important features of a payroll solution. Keeping track of your reimbursements and credits becomes more manageable with an organized payroll solution.
This means that HR managers can proceed with invoice generation and grant approvals on the go. Moreover, reimbursements for remote workers become faster and error-proof.
6. Enjoy Customization Capabilities
An ideal payroll software comes up with customizable templates and other functionalities. These include parameters like professional tax, PF, basic salary, PF contribution, and other features that can be customized at any point in time.
7. eTDS Submission Tools
An innovative payroll solution can make the process of generating a 24Q form and declaring TDS easier. Payroll systems let you generate reports and documents in a few clicks while dealing with compliance issues and tax laws.
8. Eliminate Calculation Errors
To get accurate results, you need to make sure that your payroll solution properly implements all the calculation algorithms and formulas. In this manner, there are fewer chances of human error. Preventing such mistakes will help you save a lot on costs.
Third-party cloud payroll systems can perform error-free calculations with the latest tax rules and laws in mind. Thus, you can bid farewell to business administration errors and make way for an efficient payroll process.
All the above-mentioned features such as auto-reporting, compensations, tax deductions, updates, and reminders are a must for a payroll solution. Even if you decide to develop your own payroll solution, make sure it includes all these modules.
Be it a small business or an enterprise, the importance of payroll systems remains the same. Choosing the right tool among the range of software available in the market is difficult. However, if you consider the points discussed in the blog, you will be able to single out the perfect payroll solution.