Small and medium sized business have numerous hurdles to overcome, and in order to operate at their maximum efficiency, it is advisable for them to outsource tasks which are better suited to specialists. One of these tasks is management of payroll, as it is repetitive and stressful, and a minor error could cost the business big money.
The advent of technology has helped eliminate manual processes, cutting down the chances of human error, administrative costs and processing fees. There are numerous advanced payroll options that should be considered, and here are the top three that would help SME’s achieve proficiency in this area.
Online Payroll Software
Automating the way salary payments are made can significantly improve the efficiency of an SME. Using specialised software, it is possible to capture employee information such as social security numbers and identification, to enable the creation of a personal profile for each employee. This helps monitor both payments and behaviour, and makes it easier to amend any information related to payroll. When an organisation has employees that are being paid at different times of the month, such as on an hourly or weekly basis, this system is an excellent payroll solution.
Online payroll software has the added advantage of being highly secure and allows for the generation of detailed reports for tracking purposes. In addition, the taxes payable for each employee can be withheld from their salaries, to ensure that these get paid in a timely manner and that they meet the most current requirements.
Salary Account Deposits
For added convenience, all employees should be encouraged to open bank accounts that are specifically for receiving their salaries. This makes it possible for the Human Resource Manager or Accountant of an SME to directly deposit employee payment into these accounts at an appointed time. There are numerous advantages for choosing this method. The first is reducing the time it takes to pay employees, then there are cost savings from mailing of checks and also the administration required can be greatly simplified.
Using this method also makes reconciliation of accounts easier, ensuring that up-to-date tax calculations can be done competently.
Prepaid Payroll Cards
Not every employee in the business may have access to a bank account, and therefore, salary account deposits will not be fully effective. A prepaid payroll card is the solution in this case. In the same way that a debit card works, the prepaid payroll card will have the salary deposited on it when it is due. The employee is then given the freedom to use the card in the same way as they would a debit card, getting access to cash using an ATM, or making payments both online and at physical stores. This makes it easy to pay employees without incurring high bank charges. It is also easy to implement this option with any new employees.
Choosing one of these options will help prevent discord in the workplace due to payroll issues, or penalties imposed from financial institutions and tax collection authorities.