Payroll software pays off
Processing payroll is an increasingly complex task in a farm business. Computerized software is a basic tool for paying employees and filing taxes. Payroll data also is becoming a critical resource in business decision making.
When your business outgrows its payroll software, the decision to buy a new program can be intimidating. That's why Red Wing Software (redwingsoftware.com/find-payroll-software) has created a Web page with worksheets and checklists to help small- and medium-size businesses.
“We hope these free tools help businesses determine what they're looking for, narrow their choices, and make their transition easier,” says Stephanie Elsen, web marketing manager, Red Wing Software, Red Wing, Minnesota.
The website suggests focusing on these following five key criteria.
1. As your number of employees grows, so do labor costs and time spent managing payroll. Setting a budget you're comfortable with helps to narrow the list of potential payroll software programs. Keep in mind that payroll applications display a range of price tags, from $200 to $20,000+, depending on the size of your operation or payroll. Setting a budget will help narrow the options best suited to your spending range.
“Just make sure it can handle what you need it to do,” Elsen says. “Try to estimate your needs over the next seven years.”
2. Regardless of how you process payroll or what system you use, a point person is key to managing it. Your optimum number of payroll staff is tied to the number of your employees. Payroll software encompasses functions such as collecting employee pay data, editing employee information, and issuing pay. Someone also has to file payroll taxes. The number of persons helping when you make a switch to a new system will diminish as you adjust to it. “Everything takes longer when it's new,” Elsen says. Know your staff resources and who will do what in advance so you're better equipped to ask the right questions about potential software programs.
3. Ask any payroll manager and you'll find that tax filing, with deadlines and late filing fines, is the greatest challenge. Some payroll software providers offer online tax filing or complete tax filing fulfillment options. These options simplify federal and state tax-filing processes. Determine how you would prefer to have your tax filing done. Are you willing to do the filing yourself with the help of your software? Or do you want your accountant to do that portion? Answering this question will help you choose the best payroll application. “We find about 98% stay with online filing once they try it,” Elsen says. “It saves a huge amount of time.”
4. Pay data is sensitive and confidential. Make sure your new payroll software includes tools that fit your security comfort level. Some systems offer security tools so only authorized employees can see certain screens or data. This is called menu-level security.