Management and processing of your payroll is a complex and time-consuming task, but it’s at financial year-end that the benefits of a comprehensive payroll solution are most apparent.
South African tax and labour laws are constantly changing and the penalties for non-compliance are a major concern for many business owners and managers. A payroll solution with the right functionality and flexibility can, however, boost your company’s earnings by helping you to find legal ways of paying as little tax as possible, simply by giving you the information you need to avoid paying unnecessary fees.
Benefits of a Payroll Solution
Payroll software offers your business several advantages:
- Calculations and details of your payroll are accurate and timeous
- The details related to filing your payroll taxes as a company and for each of your employees are correct
- Payments can be issued effectively
- and on time
- All processes can be verified for accuracy
- Internal audits prevent fraud
- Your business stays up-to-date with all SARS and labour legislation requirements
What to Look out For
In December each year, complex calculations are required to arrive at the correct annual leave and bonus pay for employees. Governed by the Basic Conditions of Employment Act (BCEA), these calculations ensure that leave pay represents individual employees’ actual earnings, taking into account commission, overtime, allowances and performance bonuses. Because these payments result in changeable income, the calculations required to comply with the BCEA are difficult and time-consuming without an automated payroll. Make sure the solution you choose is able to do such calculations.
A payroll solution should work out accurate Value Added Tax (VAT), Pay as Your Earn (PAYE), Unemployment Insurance Fund (UIF), Skills Development Levy (SDL), Compensation for Occupational Injuries and Diseases (COID), and Employment Equity Act calculations. It should also provide you with a full history of current and past payslips, and generate annual IRP5s and IT3As.
In addition to helping you pay your employees, it should also enable you to make the right deductions from their salaries before they receive them. Deductions such as medical aid and pension contributions do not get taxed if they are deducted before a salary is paid. If your company makes a contribution towards an employee’s medical aid or pension, that is also tax deductible.
Your payroll software should provide an easy way for you to keep track of contributions that you make on behalf of your employees, and to avoid paying tax on them. Also look out for a solution that allows you to draw reports on matters such as leave and bonuses easily.
A final consideration that must never be overlooked is the availability of local training and support.
Payroll Software Solutions Providers:
An online solution, no installation or backups are required; it can be accessed anytime, anywhere.
Contact: 0861 777 223 (PSPACE),
Manages all aspects regarding payroll, including payroll calculations, leave registers, report writing, tax year-end.
Contact: 0861 QBOOKS (0861 726 657),
This provides one integrated solution for payroll and HR management.
Contact: 0861 55 44 33,