All businesses with more than one employee must have a payroll system. It not only affects the morale of employees, but also reflects the financial stability of the company. It is also a requirement to comply with federal and state laws.
Although this is a complex process, having an effective system helps to streamline and centralize the payroll method.
Basically, the payroll management process refers to the management of an employee’s financial records, including salaries, wages, premiums, deductions and net payments.
No matter, what’s the size of the organization, managing the payroll system is crucial. Company with fewer employees can use the single writing system.
New business owners who are not knowledgeable in the process may find the procedure challenging because of the various laws requirements that must be complied with.
To succeed in a world with greater time demands and leaner profit margins, we must find alternatives to the way we do our business.
Tally.ERP 9 is packed with a secured, flexible & built-in Payroll management feature. This feature helps you manage simplify payroll accounting, salary processing, attendance management and payroll statutory forms.
Statutory compliance: All legal deductions, such as EPF, TDS, ESI, are deducted from the payroll. The company then remits the amount to the respective government agencies. The frequency can vary depending on the type of the payments.
In most cases, dues are paid through the challan. After all dues are paid return/report are filed. For example, ECR is generated and filed to fill the PF return.
Payroll accounting: Each organization maintains a record of all financial transactions. The paid salary is one of the important operating costs that must be reported in the books. As part of the payroll management, it is important to check that all salary and reimbursement data are properly fed into the accounting / ERP system.
Payment: You can pay salary by cash, cheque or bank transfer. Usually organizations offer employees a bank salary account. After completing the payroll, you must make sure that the bank account of the company has sufficient balance to pay the salary.
Then you must send a salary bank recommendation notice to the relevant branch. This statement is issued with particulars like employee ID, bank account number, salary amount, etc.
Reporting: When you complete the payslip for a certain month, the finance and high management team will ask of reports such as the cost of employees on a departmental basis, employee costs on a location basis, and so on. Get the necessary information and share the reports.