A good business accounting and payroll funding software does more than merely balance bank accounts and print checks. The best accounting software provides business owners a detailed reporting system for evaluating their business and deciding how to grow and improve business.
Payroll software does more than simply give you the ability to print checks. Payroll software allows a business to track the productivity of employees and keep detailed employee records for federal reporting and internal employee reviews. When choosing a payroll software, business owners should first ask themselves several questions to determine which features to search for when purchasing payroll and accounting software.
1. Do I want to keep detailed employee records?
Some payroll software will just figure gross payroll and payroll taxes and print checks. Beyond that, it is not useful in keeping employee records such as attendance, benefits and performance. Decide what you need from a payroll software and then shop for those features. The best payroll software allows an employer to enter a detailed employee profile, keep employee records, enter notes, attach evaluation documents and compute payroll. Keeping all employee records in one easy-to-use software program allows business owners, especially small business owners, to comply with all federal and state employer requirements without the necessity of learning to operate multiple software programs.
2. Will I figure my own payroll taxes or have an accountant do that for me?
My first employer allowed me to use the payroll software; however, his accountant would call me with the figures to put into the software. Because he chose to do this, I did not need payroll software that offered periodic updates for tax tables. However, the more cost effective option is to use a payroll accounting software that updates payroll tax tables online. Look for features that include automatic online updates and guaranteed current tax tables. As a business owner, you must make sure that you deduct the correct amount of payroll taxes and keep detailed records.
3. Do I have both salary and hourly employees?
Figuring payroll for salary employees is easier than it is for hourly employees because hourly payroll must be set up to factor in overtime, paid time off and vacation time. If you have hourly employees, look for payroll software features that allow the information to be entered once as a system preference and used for each employee. In addition, the software should allow you to override the system settings if one or more employees payroll is calculated different based on disability pay or other special circumstances.
4. Do I want to offer direct deposit?
Direct deposit is the green way to do payroll because it reduces the use of paper, ink and other supplies. Furthermore, it benefits employees because they no longer must rush to the bank in order to deposit or cash their payroll checks. A good payroll software will allow the employer to easily set up direct deposit and even allow employees to designate multiple accounts to use for their deposits. Be careful to check for hidden fees for direct deposit when choosing a payroll software.
5. Do I need my payroll software to manage employee retirement benefits?
As part of your employee benefits package, you may offer employees a variety of retirement and health plans such as FSAs, HSAs, 401k plans and 403b plans. There are also many other benefits that may require a business owner to deduct amounts from an employee’s payroll for transfer to other accounts or another company. If so, search for an accounting software that combines payroll services with features to administer employee benefits.
A good payroll software should be able to do the following:
- Generate and print employee paychecks for both salary and hourly employees
- Track employee payroll history including sick time, paid time off, vacation time and salary history
- Track and provide reports of employee performance, reviews and goals
- Store and edit employee information such as emergency contact information, personal data and other relevant employee information
- Easily transfer payroll information to the general ledger
- Track and transfer payroll tax information to other modules for reporting purposes
- Generate and print detailed reports, documents and returns