When you implement payroll and tax software, it helps to decrease the hours your employees have to spend on time-consuming tasks. More importantly, it improves your company’s accuracy and regulatory compliance. Instead of devoting your time to handling payroll and tax compliance, you can focus on what you do best: running your business. 

The Advantages of Payroll And Tax Software 

Even at a small business, payroll-related tasks can eat up two to five labor hours of labor every pay period. Tax compliance takes up even more time. 

Fortunately, there’s a simple solution for small businesses. Through payroll and tax software, you can save time, reduce your labor spending, and ensure a better level of compliance. The following are just a few of the benefits involved in payroll and tax software. 

More Accurate Payroll

A major advantage of using payroll software is its accuracy. You don’t have to get bogged down in the complexities of payroll management. Instead, the software accurately calculates pay and makes timely direct deposits. 

Plus, employees can easily update their information in payroll and HR software. Once the employee personally enters their updated information, important tax forms and direct deposit information can be sent to an accurate destination.

Improved Risk Management 

When you designate someone to handle taxes and payroll at your organization, they must receive ongoing training about legal compliance and regulatory changes. Otherwise, your business is at risk of receiving penalties and fines. Training takes time, and it must be done with great care. 

By using payroll and tax software, you can manage your compliance risk. It stores documents so that you are prepared for any audits. Additionally, tax and payroll software is regularly updated by experts whose only job is to understand the changing regulatory environment. As a result, you get world-class expertise.

Additional Direct Deposit Options 

With payroll software, you don’t have to simply cut checks and hand them out each Friday. Good payroll software programs support electronic payments, so employees can receive their paychecks in their bank accounts. 

Advanced payroll software lets employees split their paychecks between different accounts. For example, they can decide on the specific percentages they want to go into each account. Plus, top payroll software providers offer earned wage access, which is where employees can immediately access wages they’ve already earned if they need their pay early.

Compliance With Tax Laws 

Staying compliant with a changing sea of tax and labor laws can be incredibly challenging for small businesses. Fortunately, tax software provides easy compliance. This software includes automated tax compliance features, so it can instantly calculate the amount of federal, state, and local taxes that need to be pulled out. Thanks to these features, your company is less likely to suffer from tax penalties for payroll errors.

Tax Form Generation 

As a small business, you don’t want to spend your time and energy on filling out tax forms. With payroll and tax software, your company’s forms, such as W-2s, 1099s, and year-end tax documents, can be generated automatically. You won’t have to figure out which forms to file or when to send them in because they’ll automatically get completed when they’re needed. 

Audit-Worthy Record Keeping

No one wants to be audited. If an audit does occur, it’s important to be prepared. One of the major advantages of using payroll and tax software is that you can easily create an audit trail of payroll transactions and detailed records. If you’re ever faced with an audit, you can relax with the knowledge that your company can easily show its compliance with major regulations.

How Payroll and Tax Software Works 

While each provider is different, many payroll and tax software providers have similar benefits. When looking for the right provider, you should consider the provider’s track record, their add-on services, and how well they can integrate their software with your company’s existing programs.

Employees Can Update Their Information 

With top payroll, tax, and HR software, employees can update their information on their own. The average company spends $4.78 for each manual HR entry. Since each employee may update their information multiple times in a single year, this cost can add up. Additionally, employee self-service is more accurate because you can rely on the information the employee entered on their own.

Payroll Taxes Get Filed on Your Behalf

As a small business, you can’t afford costly compliance mistakes. Payroll and tax software can calculate taxes on your behalf, so you don’t have to stay up to date on all of the latest federal, state, and local tax regulations.

Convenient Integration With Your Company’s Software Systems 

If you already have existing benefits, employee records, and time tracking programs, the payroll and tax software can be integrated into them. This makes it easier to instantly update the payroll software with how much the employee should be paid.

Integration is important because it helps you prevent duplication of records and errors. You also ensure that your HR systems are streamlined as much as possible.

By integrating time tracking, you can reduce payroll and tax errors. Plus, it helps to save time on transferring data and ensures your company is in compliance with labor laws about overtime. 

Meanwhile, integration with benefits enrollment makes it easy to set up benefits for new hires. When information has to be changed, benefits integration means the information automatically transfers between different systems. This decreases the odds of administrative errors and ensures up-to-date records.

Payroll Software Handles Garnishments 

Sometimes, the courts require employers to garnish wages from their employees. After this information is input into your payroll system, the garnished wages can be automatically pulled out. You don’t have to worry you’ll forget about the garnishment or accidentally remove the wrong amount. With payroll software, you can reduce your banking fees and legal liability.

ACA Compliance Gets Handled Through the Software

Under the ACA, there are certain legal compliance measures that companies must fulfill. Payroll and tax software can handle these compliance requirements for you, so you don’t have to be worried about whether your company has followed the law correctly or not.

Improve Your Compliance and Accuracy With Payroll and Tax Software

With the help of payroll and tax software, you can ensure payroll accuracy and tax compliance. The right software can help your organization avoid tax penalties and fines. Plus, this type of software can reduce the amount of time and labor your organization spends on handling payroll and tax compliance. 

If you want to learn more about how payroll and tax software can help your company, reach out to our small business HR and payroll experts today.