Managing payroll and tax is more complicated and technical than ever. Small and large business owners have to deal with a plethora of complications while paying salaries to employees and deducting taxes. They have to be careful while calculating and filing federal, state, and local payroll taxes. Adding to it, they also have their own set of tax forms to stay compliant with the government and avoid any penalties or reputation damage. Even a small payroll and tax mistake has the potential to be costly for organizations. Hence, companies are leveraging technology to fulfill their payroll and tax management requirements.
In this technologically advanced world, trusting online payroll software is the right thing to do. It not only spots tax fraud and errors but also ensures compliance. Moreover, it strategically guides employers and HR professionals at every step of the way without suffering from tax season burnout.
There is no denying that the tax management system is critical to businesses to ensure that their efforts are focused where they are needed. However, choosing the right software that manages all your tax and payroll needs efficiently is not easy. You have to be meticulous while evaluating all the options and then make an informed decision. Before we start with the tips to select the best tax management software, let’s learn a bit more about payroll tax management.
What is Payroll Tax Management Software?
In this ever-evolving payroll tax landscape, especially when your business is in multiple states and jurisdictions, you need a reliable and simple solution. Hence, payroll tax management software that covers all HR and HCM needs, including payroll, tax filing, benefits administration, HR functions, etc., and scales according to business needs. This unified software system simplifies the process, allows you to control key aspects, provides increased efficiency, and ensures seamless operations. You can conveniently handle taxes for you and your employees in one place, and access tax data files for better insights. What’s more, this sophisticated software also takes care of tax deposits, annual returns, filing the returns, and more.
Accomplish EP is a trusted HCM platform, helping thousands of companies with their payroll tax processing. Its cloud-based features and functionalities allow effective payroll tax management and offer unprecedented options for complete customization. A comprehensive tax management system aims at:
- Mitigating risks and reducing responsibilities of payroll tax rates.
- Debiting payroll taxes and depositing them on the due date.
- Remitting and singing tax filings and handling forms.
How to Choose the Best Software for Payroll Tax Management?
You have to consider various factors while selecting the right software for your company. Of course, every organization has unique requirements and specifications, we have listed a few common criteria to make sure that you get your hands on the most reliable platform. Have a look:
Payroll & Tax Management Needs
As you start exploring options and research about different software available, you must have a clear idea of what you want. Analyze your business needs and objectives to implement software in your organization, such as the number of employees, size of the company, budget, etc. Also, you have to decide whether you want to install the tax software on the desktop or prefer an online portal that is accessible from anywhere. Both of these options have their pros and cons, and you must consider all the aspects to find which one is convenient for you. Go through these questions to analyze your business requirements:
- What is your budget?
- How many employees do you have?
- How large is your business?
- How often will you conduct payroll?
- How many seasonal or temporary employees do you have?
- Will employees have benefits?
- Do you need a standalone payroll and tax management software?
- Who will administer payroll and how much experience do they have?
- Will you be printing out payslips for employees?
Based on your answers, evaluate different software and remove the ones from the list that don’t suit your needs.
Cost & Features
For small business owners- well for every business owner, budget is a primary factor. The amount they can spend to buy any software is vital for the decision-making process. Of course, you analyze every product based on its performance and functions but you cannot ignore how much it charges as well. HR software solution for payroll tax management is no exception to it. So, create a detailed budget beyond which you cannot go, make sure that you keep it flexible. The final cost will vary based on the software, its features, and the demands of your business. Many software are free for the initial months while some consider the number of employees you add to the system. Here is a brief cost breakdown for you:
- Basic fee
- Taxes and compliance
- Setup fee
- Pay runs
Next comes features. Software systems also charge fees according to additional and advanced features that you want in it. Consider must-have and beneficial add-ons features of tax management, including integrations, security, tax filing, self-service, etc. It will help you determine the most suitable solution for your business. Also, the list of features you want to include in your software will affect its ease of use and accuracy. Some essential features to consider are:
- Tax filing
- Direct deposits
- Mobile access
- Employee self-service
- Payroll reports
- New hire reporting
- Alerts and notifications
If you have other software systems in place or planning to implement new platforms for various HR functions, then integration is one feature that you don’t want to miss. You must make sure that your tax management software integrates with other applications seamlessly without any disruptions. It will avoid downtime during the export or import of data between platforms and will streamline the process. The integration capabilities are a must to reduce time, cost, and resources while improving analytics.
Integrating payroll software with HR systems and accounting software mitigates risks related to security breaches and information mismanagement. You can also look for a comprehensive system that combines payroll functionality with other HCM features as part of its suite of services. Rest assured this one-stop solution will keep you from tearing your hair out and ensure smooth workflow.
It is important to stay compliant with the current economic and labor laws because any ignorance can lead to serious consequences and hefty penalties. Therefore, check all the standard and additional payroll and tax legislation that your company needs to adhere to, including federal, state, and local regulations. When your payroll package is legally compliant, you can eliminate the chances of costly fines, financial loss, and damage to brand image. Your software should be up to date and must keep pace with the latest news and trends like changes in collective agreements.
In case your company offers flexible compensation plans, this point is even more crucial as the maximum exempt amount also changes and their rules are also different depending on the location. Hence, educate yourself and read as much as possible about payroll legislation and rules that may affect your business. You can connect with the American Payroll Association for help and assistance, get a better understanding of laws through informative courses and programs. This will keep your company away from any legal consequences.
As we move toward digitization and automation, employees expect more control over their data and a greater level of access to their information. You cannot handle everything yourself and expect them to run back and forth to seek every news and information. It’s time to let them take responsibility for a few key tasks and free your HR department to focus on other core activities. Also, this will engage your employees more and increase their workplace satisfaction. As you replace paper checks and direct deposits with digital methods of payments, allow employees to view their pay stubs and track their tax forms.
Just like employee benefits software where they have the liberty to analyze all the schemes and then choose the one that suits them best, the payroll and tax management system empowers them to manage and handle their data with just a few clicks. This self-service portal gives access to year-end tax forms, time off balances, payroll laws, pay stubs, and more to fill applications for a home loan and other purposes where bank statements don’t work.
One of the main reasons to implement online payroll software is to help companies and employees optimize payroll and tax management. Traditional and outdated methods were not capable enough to achieve this, hence experts came up with something modern and sophisticated. But this is not enough, your software must be automated and streamlined, thereby updating relevant fields and information without human intervention. It must be able to handle:
Contracts: Data related to agreements and contracts is critical for smooth business processes. Any changes done in these documents must be reflected in the payslip instantly for timely review.
Employee Profile: As the personal situation and any life event of employees affect their remuneration and tax management, your software must automatically read their profile and make the required changes soon.
Benefits: If you are offering flexible compensation and multiple benefits plans to your workforce, then implement software that adjusts monthly changes automatically.
Absence & Leaves: The software must also synchronize with the company’s calendar and align each incident with the worker’s payroll.
This is not the exhaustive list of things you must consider while selecting a tax management system. There are several other factors as well, such as security, help & support, mobile compatibility, user-friendliness, and more. Investing in payroll and tax management software is a big decision for any company and you don’t want to rush through it. Weigh all the pros and cons of each option available, do your research, determine which software matches your needs, company size, budget, employee needs, and business type.
Accomplish EP is a leading HR software, trusted by thousands of employers and employees. It brings all the HR functions, such as ATS, benefits administration payroll processing, etc., to one platform. Our dedicated support team is always available to help you and guide you throughout. So, connect with us now for a free demo and further discussion.