Small businesses are the backbone of the U.S. economy, creating more than 65% of all jobs and contributing 44% of the gross domestic product (GDP). However, small businesses face challenges that much larger companies do not, especially regarding resources, time, and money.
Payroll software can empower small businesses to overcome these obstacles and achieve rapid growth by freeing up time, increasing profits, helping reduce taxes, and increasing efficiency within the business itself. The 10 most important ways that payroll software can empower small businesses are listed below.
1) Provide accurate payroll
It’s not uncommon for companies to make payroll errors, even large ones. Every year, small businesses lose millions of dollars in tax deductions and FICA payments because they don’t have a good understanding of federal and state laws. Having a payroll management solution that gives you insights into your spending lets you know how much money is going out and whether or not that match what is legally required. Accurate payroll management is essential for growing a business.
2) Ease of compliance
Ensuring compliance with payroll, tax, and government regulations is a big job. That’s why it pays to work with a payroll software solution that can simplify compliance management and give you more time to grow your business. The importance of compliance becomes even greater as your business grows. This is particularly true if you plan to raise funding or go public one day.
3) Fast, easy data entry
Good payroll software will allow you to quickly and easily track your data, so it’s a good idea to take a look at a program’s interface before deciding if it’s right for you. Payroll software can be installed locally or hosted remotely, but whichever option you choose, look for one that offers easy data entry, especially when it comes to employee time tracking. Some programs can automatically track hours from their systems into yours. Others offer an API where you can track yourself.
4) Quick updates on changes in laws and regulations
Don’t rely on your in-house payroll employee to keep up with all of these changes or—even worse—to interpret them. Make it easy on yourself by checking in occasionally with payroll software providers to see what they are adding or changing in their systems.
Not only will you be ensuring that your employees are paying exactly what they should be, but you’ll also be giving yourself an update on any new tax laws or regulations that may affect business owners in your state. The more informed you are about what is going on in your industry, state, and country, the better chance you have of thriving through it all.
5) Easily manage time-off management
The best way to provide high service levels to your clients is to ensure you always have employees available. But what happens when you need to take time off for vacation or illness? This can be a major burden if your business doesn’t have an established PTO policy in place. Ensuring everyone has clear guidelines on how time off should be reported and approved will save you hours of wasted workdays.
6) Direct Deposit
The IRS estimates that there are more than 30 million small businesses in America. That’s why many of them are likely not complying with federal income tax rules on wage payments, which require employers to pay employees via check or direct deposit. Failure to comply with these rules can result in steep fines or penalties.
Fortunately, software like UZIO can help employers automate payroll processes and make direct deposits mandatory for all employees, streamlining compliance processes while also simplifying employee information tracking. This creates a significant competitive advantage for firms that adopt innovative technology solutions like Zenefits’ business management software to manage their enterprise. Employers who fail to do so face a tough choice: either pay a fine or risk losing good workers if they don’t pay on time.
7) Accurate tax calculation & filing
As a business owner, you may be required to pay taxes in multiple states. To make sure your business complies with all state tax regulations, you need software that can accurately calculate and file sales tax for each state. An inaccurate filing could end up costing you money in penalties and fines. Several great services are available for small businesses that offer online payroll management, accounting, invoicing, and other financial services designed specifically for small businesses.
8) Simple setup & easy installation process
The most important thing to consider when choosing payroll software is how easy it is to set up and start using. Simple installation and setup can make all of the difference when it comes to selecting a program that will provide fast and easy access for both you and your employees while remaining in compliance with local laws. If you have any issues setting up or installing your payroll software, don’t hesitate to reach out for help from customer service representatives who are standing by 24/7.
Published November 11th, 2021