Payroll Software - A Complete Guide 2020

‘Payroll processing’ becomes a draconian activity for pvt ltd and public sector organizations if they don’t have a robust tool and right resources for payroll. Accurate and timely payroll is possible when the human resource team has cloud-based payroll management software in place. Cloud-technology and mobile plays a pivotal part in payroll revolution.

Challenges in payroll processing

‘Salary processing’ is a critical yet important task for the human resource team irrespective of the industry type. Any error in payroll and other related duties like wrong salary calculations, incorrect tax deductions, error in attendance records, can cost an organization dearly in the form of penalties. Also, it makes your employees unhappy!

Below is the list of some major challenges in payroll that HR professionals experience during salary processing;

Stages in Salary Processing

Payroll and other related activities are repetitive, tedious and important and hence, opting for payroll system is a big relief for pvt ltd and public sector companies. The software of payroll includes various built-in tools to support different stages of payroll that makes the whole process easier and quicker.

Correct employee classification

By the proper classification of employees, companies are able to determine who are eligible for tax exemptions and who are not. Also, it helps you to issue them certain forms and you can be aware of which taxes need to be withheld.

Time tracking and attendance

Before calculating the final amount, you need to consider some important parameters such as loss of pay (LOP), approved leaves, unapproved leaves, reimbursements and compensatory amount (if any).

Benefits and deductions

Some common type of deductions are provident fund (PF), employees’ state insurance (ESIC) and professional tax (PTAX). ESIC deductions vary from state to state and it covers health insurance of employees. Professional tax is the direct tax collected by the Indian government.

Tax deductions

Calculating precise tax deductions is necessary for future audits. This is very much important for employers to calculate the correct amount of taxes and pay employees the exact amount to avoid any type of penalties and legal actions.

Salary credit

This is the pay day on which the payroll team issues the payments to your employees.

Features of Pocket HRMS payroll software

Cost-efficient

Ease of access

Intuitive time and attendance management

Full email integration

Swift implementation

Real-time insights

Multi-location support

Worry-free storage

Liberty to customize

Paperless payroll

Cloud availability

Compliance

Pricing plans

Customer service

Implementation cycle

Number of features, etc.



Benefits of cloud-based online payroll software

Stores employees’ data and automatically calculate Stores employees’ data and automatically calculate Process payroll every month based on intelligent computations and deductions. Process payroll every month based on intelligent computations and deductions. Helps to accurately calculate the payroll parameters like worked hours, gross pay, tax, PF and PL. Helps to accurately calculate the payroll parameters like worked hours, gross pay, tax, PF and PL. With all data being managed and stored on a cloud-platform, so no worries of data security theft. With all data being managed and stored on a cloud-platform, so no worries of data security theft.

Cost-effective and saves a huge amount of effort and time of the HR department. Cost-effective and saves a huge amount of effort and time of the HR department. Ensures all statutory compliances are being followed. Ensures all statutory compliances are being followed. Empowers HR to process payroll from anywhere and anytime! Empowers HR to process payroll from anywhere and anytime! Help you to avoid payroll redundancies and mistakes. Help you to avoid payroll redundancies and mistakes.

Checklist for buying the right payroll system

With technological advances, payroll processing is becoming increasingly easier to conduct in-house instead of outsourcing this procedure. Below is the quick checklist that helps employers to select the right payroll software:

Q: Can the payroll software modules help you get automatic attendance and leave reports of your employees?

A: Yes, ensure that the software is available with an integrated online attendance and leave management systems.



Q: Does the payroll software for small to big companies have current tax information for your state?

A: Make sure that the cloud-based payroll system is equipped with current tax information of all the states from which you can manage the ESIC, statutory deductions, tax deductions, HRA, etc. of employees.



Q: Is the vendor offering a free demo or few days trial period of the of payroll software?

A: This shall give you a good idea about the software’s efficiency and working before you actually invest to buy it. Also, check whether the pricing plans are scalable or not.



Q: Are there any hidden fees or charges?

A: Check with your vendor whether the payroll software has any hidden charges or fees as these minor details help you to keep a tab on your budget which you get from your company to purchase this software.



Q: Does payroll software offer database back-ups?

A: Yes, the software for salary processing should take regular back-ups and it should be available with centralised repository in order to recover data in the event of data loss due to natural mishaps, system breakdown, etc.

Payroll pricing

There are tons of options available in the market for payroll software and hence, you need to deep dive while selecting the perfect software that suits your hr and payroll needs. Different HRMS systems comes with different pricing and different set of features. Pricing can be monthly or annually based depending upon vendor or your business. There also exist categories under subscriptions. They are - Standard, professional, premium or FREE trials as well. Each category comes up with its unique set of modules. Check out what Pocket HRMS offers here! Also, don't forget to ask for free trials of or our payroll solution. In short, you can get the best payroll software with limited budget also only if you do the market study properly!

Terminologies in payroll

Get familiar with payroll terminologies to avoid the complexities of hr and payroll activities!

Cost to Company (CTC) – Cost to the company (CTC) is the total cost of monetary & non-monetary benefits that an employer incurs on an employee during one year.

Employees’ Provident Fund (EPF) – A type of deduction done from the salary of an employee. This deduction needs to be made at every payroll.

Gross salary/wage - The total salary of an employee before deductions.

Net salary - The amount after deductions. Net salary is also termed as the in-hand or takeaway salary.



Allowance – This is the fixed amount paid to staff along with basic salary to cover expenses of activities like travelling to the office, eating food or house rent.



Paid Leave – During these types of leaves from work, an employee receives his normal payments.



Leave Encashment – Leave Encashment means receiving money from the company for unused leaves.

Compensatory Off – Compensatory off or comp Off is the leave or time off given to employees for working extra hours.

With the help of correct information, advanced technology and proper planning, accurate and timely hr and payroll tasks can be easily done! Pocket HRMS, cloud-based hr solution, is ready to assist all pvt ltd and public sector businesses with our software in their hr and payroll tasks. Juts request a free demo now!

Misclassification of employees can pave way for incorrect payroll. Differentiate your staff based on their department, designation and job role.

Calculating exact pay for exact worked hours is a tedious task, so invest in time tracking software to manage and record exact working hours for accurate payroll.

Managing statutory compliances is a big hurdle for HR which would cost pvt ltd and public sector companies huge penalties, so better implement cloud-based online payroll system to handle all payroll-related concerns, include statutory compliance.

Frequently Asked Questions (FAQs)

What is online payroll software?

A payroll software is primarily meant to handle payroll for employees. This includes tracking time and attendance of employees, calculating arrears and other salary parameters like PTax, PF, etc. Online payroll software lets your payroll department work on the go. Cloud availability provides flexibility to the process.

What does payroll software do?

An effective payroll software tracks payroll elements like attendance, deductions, LOP (loss of pay), remaining PL (paid leaves), arrears, compensatory amount, PF, employee tax and similar parameters. The software then calculates the final payment based on their income and additional credit and deductions.

How much does payroll software cost?

There are a few factors that contributes to the costing of a payroll software. Popular factors include compliance management and cloud-availability. However, different companies offer different range of pricing anywhere from INR 1499 to INR 2999 per month based on features they offer. Some companies provide monthly subscriptions and yearly plans based on client needs. Also, you can avail FREE trials for payroll software.

Which is the best payroll software in India?

There are finite parameters, which make a payroll software best fit for your organisation. Some of the parameters include:

Cloud availability

Compliance

Pricing plans

Customer service

Implementation cycle

Number of features, etc.

Pocket HRMS is one such all-in-one HR solution with dedicated module for streamlining your payroll process. The payroll management module lets you generate reports and payslips in seconds. It keeps you on track of everything in payroll. Pocket HRMS is one of the top performing payroll software in India.

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