Finding the right online payroll software that suits your business can be a long, arduous process, and it’s important that you don’t rush the decision and choose the wrong service. There are many factors you have to consider, which is why we’ve compiled a (mostly) unbiased list of everything you need to know about what an online payroll software is, what it offers, and how you can make the best decision when choosing one.
What is Payroll Software?
Your typical online payroll service operates in the cloud, so businesses are able to manage and run their payroll from anywhere that they have internet access. The software will pay all your employees, full- and part-time alike, and typically includes a variety of additional services. Some of these services include:
- Tax Filing - Your payroll software should automatically withhold your employee taxes, file quarterly tax reports and pay tax withholdings to the appropriate state and federal agencies. They should also issue employee Forms W-2 and 1099 at the end of the year.
- New Hire Reporting - A quality payroll service should report your new hires to the government on your behalf.
- Employee Self-Service (ESS) - Your employees should have access to the software, allowing them to view pay stubs, request time off, and obtain their year-end tax forms.
- Additional Software - Depending on the size and nature of your business, you should have the option to utilize additional software that works seamlessly with your payroll. The most common of these include Time & Attendance, HR and Benefits Administration, Applicant Tracking, ACA Reporting and Onboarding.
Using an online payroll software has many advantages, but the biggest is that all your payroll calculation, tax filing, year-end forms, etc. are taken care of for you. Your payroll can be run in just a few minutes, and it will save you a lot of time and effort. Furthermore, you typically have access to personal assistance right at your fingertips, so any questions or complications you might come across can be resolved with just a simple phone call, email, or i.m. chat conversation. This is particularly true if you’re utilizing a small, locally owned company. When we ask our clients here at Dominion what they enjoy the most about using our software, nine times out of ten they will say our customer service.
Of course, there are some negative aspects of using a payroll software. The most obvious con is that using a payroll service is going to be more expensive than running your payroll yourself. (Although in some situations this is not necessarily true. Sometimes it costs more in labor hours for a person to do their payroll in-house than it would be to use a software.) What’s more, you have to be willing to trust your payroll provider. If they make a mistake, you’re going to be the one who has to face your employees. That being said, I can speak personally when I say most mistakes in the payroll industry can be fixed with relative ease. At the end of the day, you should choose a payroll provider who you are able to formulate some semblance of a relationship with, so you can rest easy knowing they are in charge of your payroll.
The price for payroll software will vary greatly between providers. However, because of the sensitive nature that goes along with processing payroll, you don’t always want to choose the cheapest option right off the bat. Many times large corporate payroll providers can afford to offer their service cheaper than the business right down the road from you. However, the quality of the software is often sub-par, and getting ahold of a human representative can take up half of your workday. Make sure you do thorough research when deciding on a provider, and ask for feedback from other clients who use that same service. If there are case studies available that are in your industry, those can be a great resource to see how that provider will work with your business. Watching a demo of their software as another great way to see if the functionality and usability meet your standards.
Interested in learning what Dominion can do for you?