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Why is Payroll Software Essential for Small Businesses?

Why is Payroll Software Essential for Small Businesses?

Small businesses have much to gain from payroll software. With rich feature sets and intuitive, easy-to-use user interfaces, the best payroll software can help small businesses manage payroll quickly and effectively. There is no need for accounting expertise to get things done, and with informational resources and tutorials, non-experts can quickly learn how to become an effective payroll administrator for a small business.

Pay Your Employees Accurately and On Time

Small businesses must conform to government regulations and laws just like any other business, and it is here that payroll software can prove vital. It can mean not having to employee a third party or a person specifically skilled in payroll.

With a good application it is easy to keep implement and manage all of the various employee pay schedules, deductions, holidays and other types of addition and deduction. It is just as easy to introduce a new employee to the system, with the inclusion of starter information for tax purposes.

By making all aspects of payroll management as easy as possible, payroll software helps to ensure that you pay your employees on time, and greatly reduces the room for error in your payroll management and calculations. With RTI payroll software you can make full payment submissions (as well as numerous other types of submission) online to HMRC, as well as create and print out payslips, P45, P60 and similar forms.

Financial Reporting

To help themselves make the most appropriate decisions and plan effectively for the future, small businesses must have a firm and detailed understanding of their financial situation. Payroll software makes it easy for small businesses to electronically archive all payroll information, and analyse this information for accounting purposes.

Save Time and Money

Keeping a tight lid on expenses is an essential goal for any smaller business, and with some payroll software packages you can save money by not having to pay for a license. There are a number of payroll packages that are free for businesses that have under a specific number of employees. Even if your business does not meet this criteria and you need to purchase a license, prices are usually competitive, and the amount of time and effort you save in using quality software will always make up for it.

Learning the Basics of Payroll

There are some payroll software applications that offer guidance, tutorials and educational support–not just for using the software, but for payroll in general. This is vital for small businesses that are new to payroll and want to learn the rudiments without wasting time. Look out for software providers that offer free support services – this can be a very useful extra for small businesses.

Make Sure Your Software is Accredited

For example, HM Revenue & Customs provides a list of HMRC-accredited UK payroll software on their website. Software which is included in this list has been verified as able to correctly send PAYE real time reports throughout the tax year. As such you can be sure that software on this list will meet the latest PAYE RTI requirements.

Looking for next steps? Be sure to explore our Top 10 Financial Management Software report as well as our Financial Management Software resource page.

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Sara Rufo

Online IT Strategist, Bright Pay
Expert in Accounting, Contract Management and Human Resources Management