Setting up a payroll process can seem like a daunting process if you jump straight from the starting point to the end result without breaking it down. It is important to remember that compartmentalizing each task and handling it efficiently will create payroll processing solutions that will yield great long term benefits.
This is especially true when selecting and working with a third party payroll processor who can help you with many of the more intricate steps along the way. When you combine a well-thought out plan with payroll processing partners who have a history of success, it’s a winning combination!
What are the Steps in the Payroll Process?
The payroll process is largely defined by the collection, aggregation, and distribution of information. Ultimately, it ends with your employees getting paid and being happy, but there are many technical steps in between. These steps might include:
-Getting your Tax IDs in order
-Understanding what taxes to report and pay
-Establishing a payroll schedule
-Calculating Gross pay
-Inputting any deductions
-Calculating net pay
-Distributing checks and stubs
-Keeping accurate records for reconciliation
These are just some of the tasks included in a baseline process. No one business is the same, and your field or employee structure may require more inputs.
How Long Does Payroll Take to Process?
Typically, payroll is run 1, 2, or 4 days before direct deposits and checks are available to employees. Four day processes are usually reserved for contractors, so we will focus more on the one and two day processes that revolve around employees.
Regardless of the timing, the common denominator is you must have enough money in your bank account to disburse to your employees. Make sure to check your payroll bank account to make sure your process is not hindered by insufficient funds.
It is also important to note that the deadline for any of your processing days is 4 pm PT in order to begin processing during the next business day. So if you want to have employees paid on Friday, a 1-day deadline would be Thursday at 4:00 pm PT, and so on.
Luckily, most good payroll processing software has great reminders for deadlines!
What is the Easiest Payroll Software to Use?
Online payroll software has taken over for traditional desktop-to-processor workflow in the last few decades. There are household names such as Paychex, or Quickbooks (and now Quickbooks Online), which have great merit to their reputation.
There are other up-and-coming payroll software partners making processing a lot easier today. Zenefits is a great option, and Gusto is one of the leaders in easy software solutions to save you time and money.
Ultimately, the ease of using payroll software comes down to your business size, level of comfort with the provider, and the customer service made available by that business. We recommend doing a cost/benefit analysis of your internal payroll versus any of these solutions, and considering a full-suite payroll processing solution.
What are the Best Payroll Processing Solutions?
Payroll processing solutions are a game-changer when it comes to efficiency and decreasing stress in your business. While modern software works as great support for in-house payroll processing, it is hard to beat the ROI for a full-suite payroll processor.
The ability to offer paperless payroll reporting, have pay stubs electronically disbursed via email, and provide a full suite of HR and legal support is what separates these companies from a simple software Gusto was listed as a software provider earlier, but they are also a good choice to integrate these features.
OnPay is a good budget payroll processor, but ultimately might leave you acting more as a middleman and having a similar process to in-house payroll using a software.
Paytech stands out from many other processors. Designed to be a one-stop-shop for all your payroll needs, the intent is to let your focus remain on growing your business, not working in it. Featuring a fully-developed Payroll Plus Service with the highest standards in HR and tax policy, Paytech can help you leverage time into profit.
Payroll Processing Best Practices
Whichever processor you choose, it is important to keep strong two-way practices that will help keep your management simple. At a minimum, these should include:
-Tracking payroll dates and deadlines, including holidays and quarterly items.
-Having consistent communication patterns with your processor
-Storing data securely
-Keeping records and electronic statements on-hand for reconciliation
-Auditing your payroll processor often for continuity in these practices
Simply put, the key in payroll processing solutions is consistency and replicable patterns. You, your HR, or finance team should be able to use these records at a moment’s notice, and any employee inquiry should be handled quickly.
Having a payroll processing partner who cares about attention to detail goes a long way in achieving goals at every level of business.
When weighing the cost/benefit of using payroll software or a payroll processing solution, it is heavily weighted towards a processing solution. While no business is the same, we recommend you look into your current payroll process, and how different options can help to free up your time and cash flow.
Paytech prides itself on helping small businesses grow in this fashion, and aims to be a hub for all payroll processing solutions. If you are interested in taking the next step towards payroll processing efficiency, please contact us. It’s a conversation worth having.