Most people won't remember when payroll numbers were calculated by hand and each paycheck was written out individually. Significant technology advancements have been made since those days. Now, franchisees are faced with choosing the right application to process their payroll.
New technology has made payroll processing a much faster process. What previously took a whole afternoon can now be completed in just minutes. Even so, franchisees should consider all the options to maximize efficiencies where the payroll process is concerned. Choosing the right solution can save franchisees significant time and money.
There are two main choices available: processing payroll in-house with a payroll software application, and using an outsourced payroll service. Here is a brief comparison of the two payroll processing methods and some key points to consider when choosing between them.
Processing Payroll In-House
In-house payroll is typically done with software that is installed at the franchisee's facility. The greatest benefit to processing payroll in-house is the control one retains. Changes can easily be made, reports can he modified and printed quickly, and employee changes can be entered immediately. Processing payroll in-house does require that an employee learn the software, so staffing is a consideration. When choosing a software package, the set of features should have the ability to grow with the changing needs of the business.
A good payroll software program will offer regular tax updates for the various state tax tables; quarterly is best. The system should offer both state unemployment and tax withholding table updates so that the taxes calculated and withheld are as accurate as possible. If franchisees need to add employees in another state, the software should easily allow the taxing and reporting of wages in multiple states without having to purchase additional software to do so. Several states have now dropped the eFile (electronic filing) limit from 200 employees to 50 and this trend will no doubt continue, so a payroll software program should allow for electronic filing of both state and federal tax reports. The Internal Revenue Service and several states are making major efforts to go paperless and even though a business may not be required to eFile today, they very likely will need to do so in the near future.
Being able to directly deposit a payroll check has become commonplace and...