When it comes to payroll management, managing your startup’s finances in-house can be challenging. Working remotely is not only challenging, but also incredibly time-consuming when it comes to time tracking, taxes, withholdings, W-2s, and spreadsheet documents.
A payroll software application can automate rote tasks and house financial records for startups, thereby simplifying the process and preventing errors. Your startup may find it difficult to choose the right payroll platform and payroll provider due to the number of options available. When selecting a payroll system, startups should look for these must-have features.
Easy to use
During onboarding, accuracy, and compliance must be prioritized proactively instead of reacting to errors when they occur. The importance of accuracy over timeliness in payroll cannot be overstated. During your discussion with a prospective provider, make sure to ask about the setup process. Are there any technical resources required? What is the ease of use and straightforwardness of the process? To make sure you are comfortable with the setup process, request a demonstration and ask them to walk you through it.
Calculate taxes automatically
The Federal Insurance Contributions Act (FICA) is a tax that must be paid by most employers in the United States (U.S.). Tax deductions include federal, state, and local taxes. Due to the differing cities, states, and countries in which employees may reside, these tax requirements can be cumbersome. Complicate the equation by adding income brackets, and part-timers. Make sure your payroll software can calculate these deductions as well as voluntary contributions. With it, you can avoid costly errors, ensure that your employees are paid accurately, and avoid mind-numbing brainwork.
Online reports
A rich-featured payroll for startups can work well for handling payroll for startups and small businesses. If you cannot easily access and use the data collected across the business, then it is useless. For a real-time, birds’ eye view of your payroll, you will want to eliminate the need to aggregate data from multiple spreadsheets and systems. Ultimately, your software should generate customizable and exportable online reports. Maintaining a payroll expense record and identifying areas to cut labor costs can be made easier with this feature.
Mobile access
There are over 80 percent of people in the world who use a mobile phone or tablet. It will become increasingly important for your startup as it grows to have a payroll platform with mobile access. Ideally, your organization should be able to scale with the software you choose. Your entire team will benefit from this feature, but remote workers and employees on the go will especially find it useful. The importance of this feature cannot be overstated: it will be a game-changer in the long run.
Keeping data secure
Payroll software houses a great deal of sensitive data, including social security numbers, bank account numbers, and tax filings. Protecting employee information is crucial for your business, legal liability, and employee morale. When choosing the right solution, ask detailed questions about the application and infrastructure’s security.
The automatic updating of software
You will always have the latest version of the software with reputable software providers because they understand the importance (and the challenge) of keeping your software up-to-date. With automated updates, you ensure you have the latest security patches, and you see fewer downtimes. Choose a provider whose software does not only meet changing government regulations but also updates it based on those changes as well. It is as complex as it is necessary to stay on top of compliance. You can eliminate a lot of unnecessary stress and worry by using payroll software that is easy to use.
Direct deposit
Even though it might go without saying, direct deposit capability should be included in payroll software. Payroll checks can be eliminated using this basic feature, saving you time and resources. In addition to building trust with your workforce, it reduces the chance of payrolls getting lost in the mail or left on your desk after they’re gone for the day.
A lost paycheck is also easier to replace and reprint when you don’t have to travel to the bank to make a deposit. By offering your employees on-demand pay, you can add value to direct deposit by giving them the option to receive their wages earlier. Business startups should consider this addition to direct deposit as it can help them retain staff throughout the process.
Filing of taxes
The payroll software you choose should include federal, state, and local payroll tax filing capabilities. By letting the platform handle tax rates, deductions, exemptions, compliance requirements, and tax forms, you don’t have to worry about the details. You will save time and avoid costly penalties by utilizing this feature, which also reduces errors and ensures accuracy in your tax filings.
While choosing the right one, consider what is most important for your business when evaluating the value and benefits of different software tools. The above features are the most important. If you need assistance finding the right payroll platform, contact other startups or small business owners. Depending on their experience, your colleagues can suggest platforms to pursue and avoid.
