What to Consider While Choosing Your Payroll Software?

Choosing the right payroll software can make or break your business processes. There’s plenty to sort through, but you need to consider what you’re looking for before you shortlist any options. Make a list of the key factors and features that are important to you, and be sure to conduct thorough research before you make any final decisions.

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Talk to other business owners and read reviews to gain a high-level overview of what you can expect in terms of payroll software. As you search for a solution that meets your business needs, here are a few things that you should keep in mind,

5 Things to Consider While Choosing Payroll Software

1. How Big is Your Business?

The size of your business will dictate which payroll software you should go for. For instance, there’s certain software that may be better geared towards smaller businesses, and then there are those that are better suited to large corporations. Small businesses and startups should go for platforms with simple, intuitive features, while enterprises might want more robust software with comprehensive options.

Furthermore, small businesses are prone to error when it comes to payroll management—data from the IRS found that 40% of small businesses make payroll mistakes that end up costing them money. And it’s time-consuming as well. With that in mind, small businesses may also consider leaning in the direction of payroll services versus payroll software.

2. What is Your Paying Frequency?

One of the first questions you’ll have to ask yourself is how often you’ll be paying your employees. For a small brick and mortar business like a coffee shop, your setup might be straightforward; perhaps you have a handful of part-time employees that keep the shop running. However, as a remote ecommerce company, you might have one full-timer, some virtual assistants, and infrequent independent contractors and freelancers. Analyze your case and take a look at different payroll packages that cater to the type of payment frequencies you’ll need.

3. Is Security Prioritized?

Payroll software hosts a myriad of very important data, including social security numbers, bank account information, addresses, and much more. As such, any data breaches could damage or completely decimate your business. As you search for the best payroll system, pay particular attention to how they prioritize strong encryption. Today, digital security is more important than ever; on average, there are 230,000 new malware samples launched every single day. Great software has several features that make security synch.

You’ll also need a platform that protects you against occupational fraud. Occupational fraud is fraud committed by an employee during their tenure. In 2014, payroll fraud comprised 10.2% of all occupational fraud cases, costing companies a media loss of roughly $50,000 per year. Utilize a combination of security awareness training, regular audits, and strict user permissions to combat various types of fraud from both internal and external harm.

4. Will You Need Integrations?

Some payroll software makes it easy to integrate with different accounting packages, so if your current setup includes third-party spreadsheets or other pieces of software, you need to consider how you can combine it. For example, perhaps you want to connect it with your HRIS. Otherwise, you run into more work keeping your human resources’ platform separate and increase your risk of error.

Ideally, every time you update employee information in your HR platform, those same changes should apply to your payroll system, too. On the other hand, you may already have an HRIS system that does offer payroll capabilities. If this is the case, you’ll have to take an in-depth look into whether those included features are sufficient enough for your operations.

5. Is Mobile a Priority?

If you plan to manage your payroll from different locations or have an offsite payroll manager, mobile payroll management may be your best bet. Fortunately, there are plenty of cloud software options. Even if you’re not prioritizing mobile payroll, there are other benefits of cloud systems. For example, cloud software is much more scalable, meaning it’s able to grow just as your business does. No matter how many new hires you bring on board, cloud software can adjust to it. Because of this, you’re spending money only on the resources you need.

Final Words

Now that you know what to take into consideration while choosing your payroll software, make sure you don’t miss any of these. Analyze the offerings of different payroll software providers, sort and compare them with the top options, and make a well-informed decision.