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Every business, large and small, can benefit from using excellent payroll software. If you want to take some administrative burdens off your shoulders, a payroll system can be a good investment for your business. We have listed the five best payroll software options for 2023 below.
1. Intuit QuickBooks PayrollStarting Price$37.50 monthBenefits administrationYesContractor paymentsYes
2. PaycorStarting Price$99 monthBenefits administrationNoContractor paymentsYes
3. OnPayStarting Price$40 monthBenefits administrationYesContractor paymentsYes
4. GustoStarting Price$40 monthBenefits administrationYesContractor paymentsYes
5. PaychexStarting Price$39 monthBenefits administrationNoContractor paymentsYes
6. ADPStarting Price$59 monthBenefits administrationYes, at an extra costContractor paymentsNo
What should I consider when choosing a payroll service?
Some of the features to keep in mind when choosing a payroll provider are:
- Direct deposit options
- Payroll tax filing
- Employee self-service and onboarding
- Integration with other accounting software
- Automatic compliance updates
Best payroll software options of 2023.
Intuit QuickBooks Payroll
Base monthly price:Starting at $37.50, $5 per employee
Base monthly price:Starting at $99 per month, plus $5 per employee
Base monthly price:$40, plus $6 per employee
Base monthly price:$40, plus $6 per employee
Base monthly price:Starting at $39
Benefits administration:Yes, at an extra cost
Base monthly priceStarting at $59 per month
What is payroll?
Investopedia defines payroll as a list of employees in a company and how much they get paid. Payroll also covers all aspects of an employee’s pay, including preparing checks, withholding taxes, and keeping records of gross and net pay throughout the year.
Companies tend to designate human resources departments to run payroll unless an owner or an associate directly handles basic payroll and the employee information that comes with it. Almost all businesses use payroll software.
What are the basic steps of payroll?
Payroll consists of multiple steps that must be completed before a new employee’s first day on the job.
- Set a pay cycle: This is the frequency with which you pay your employees. This can be set at a weekly cycle, biweekly, or monthly.
- Gather important employee documents: The documents can include W-4 or W-9 tax forms, state tax withholding forms, and bank account information via a direct deposit form and voided check.
- Calculate gross pay: Gross pay is the amount an employer is due to pay an employee before taxes are deducted.
- Calculate net pay: Net pay, also known as take-home pay, is the amount an employee will take home after subtracting all deductions and taxes from the gross pay.
- Initiate payment: Initiating the payment means you will cut your employees’ checks and pay stubs or initiate the direct deposit to transfer. Typically, payment initiation is executed by a business owner, HR department, or payroll software.
- Pay taxes and record payments: Finally, you will pay the taxes you owe to the state and city and keep records of all payroll and taxes.
How does a payroll service work?
Each payroll software has its unique make and design, but most online payroll services work similarly. They usually include a cloud-based payroll portal for both employers and employees. The business owner/employer, account, bookkeeper, or HR personnel must set up benefits packages, salaries, PTO, and other payroll add-ons and options.
With the payroll service, you can typically invite new employers to self-onboard through an employee portal or mobile app and input their necessary payroll data and direct deposit information. These HR software tools provide more payroll options, helping to streamline the payday process and ensure a more user-friendly software solution for employees.
Some services offer automated payroll so you can set up employee pay and track their time. If they do not have automation, you will have to input and initiate payroll manually.
Different-sized businesses have different workflows, outsourcing levels, and human capital management levels. Unsurprisingly, HR tools for small business payroll may be way too time-consuming for larger companies.
At the same time, the software that’s best for more prominent businesses may have too high a base price and seemingly unnecessary garnishments for small business owners to justify the investment.
Choosing to invest in payroll management software for your growing business is something you will not regret. As a business owner, you have many responsibilities and tasks that demand your attention, so relying on a trusted service to handle your payroll needs is a must.
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