In companies, the management is required to maintain various employee records. The objective is to ensure that the management at the enterprise level is smooth. There are benefits of smooth management of human resources or other resources at the enterprise level. The use of software products like human resources management systems (HRMS), human resources information systems (HRIS) as well as payroll software helps to manage the employees, their salary, leaves and other allowances, incentives. This helps to make the environment at the enterprise level, productive and efficient.
Many employees associated with different businesses or corporate firms have a certain salary amount given to them on a monthly basis. For salaried employees getting a fixed amount, some deductions on taxes are made at the time of payment. Different salary amounts may have different deduction rates and therefore it is important to use the payroll management system software. The software helps the user to make calculations of salary per employee and that too for each of the payment periods.
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Things to Consider While Calculating Payroll
The following are few important factors that the PMS software user needs to consider:-
Hours of Service
For employees of a particular organization or concern, salaries vary on the basis of hours of service or commission. These salaries are calculated for the payment periods of each employee and they are always different. On the contrary, employees with fixed salaries require are calculated at the end of the payment period. While making the calculations the HR manager has to take into account unpaid leaves or work-overtime in consideration.
As an employer of an organization or firm you can offer financial assistance to the employees in the form of retirement amenities, medical aid, car leases, employee discounts then you require calculating these things as well while generating the employee salary slip at the time of employee payment. The values of deductions may fluctuate and that implies that the software user requires recalculating the payable amount at the time of payment.
Deductions on Tax
There are companies which don’t tax the salaries of their employees. Instead, these companies expect their employees to make deductions for tax on their income. However, if a company makes certain tax deductions on employee salaries then understand that such deductions need to be made before the payday and the tax should be submitted to the appropriate authority on behalf of the staff.
Commission or Bonuses
If employees of a concern get bonus then that extra amount is required to be paid to the employee. Therefore, yet again, the PMS or payroll management software is crucial to calculate employee payroll at the time of salary payment of the employees.
Benefits of Payroll Software
Following are the benefits of payroll management software:-
- Doing calculations of employee salary can be time consuming, laborious and moreover, manual calculations are prone to errors. To prevent errors from occurring, the use of PMS is recommended.
- Payroll software helps calculate employee salary after making necessary deductions on taxes. The software is useful to generate salary slips for the employees.
- Payroll software reduces time and effort in making salary calculations for the employees. It enhances the efficiency and productivity of the business.
- There are available more than one PMS software, online. There are free as well as premium software products and intrigued web surfers can choose to download the product of his choice in a hassle-free manner right from the comfort zone.
Outbooks provides Payroll Outsourcing services for accountants and accounting firms acorss the UK & Ireland. We have a team of over 150 across 4 delivery centers in India, and have been in the business for past 9 years helping our clients save over 50% on their costs.