We answer the question, “Do I need payroll software?” with a hard YES!!! Sorry for shouting, but it really is that important, and we’ll show you why. Payroll software allows you to keep track of all your payroll information in one place and create reports in just a few clicks.
If you haven’t been using payroll software in your business up to this point, we hope this article shows you how you can save time and make your life easier by doing so.
What Payroll Software Does that Online Calculators Can’t
Everything in One Place
It’s easy to find a number of payroll calculators online. Even the Canada Revenue Agency provides a free payroll deductions calculator. These calculators serve a purpose in a pinch, but they do not replace a robust payroll program. If you’ve ever used an online payroll calculator, you likely noticed it asked for a balance forward of various payroll deductions taken during the year.
Employers are required to include certain information on employee pay stubs each pay period. This includes:
- employer’s name and address,
- hours worked by the employee,
- employee’s wage rate,
- employer’s overtime wage rate,
- hours work by the employee at the overtime wage rate (if applicable),
- How the employee’s wages were calculated, and
- Payroll deductions taken to arrive at the employee’s net pay.
One of the great things about using payroll software is the software program is already set up to automatically create a pay stub based on the labour standard requirements of your province. There’s also no need to go searching for the year-to-date amounts because the payroll software automatically keeps track of that for you.
Reports in Just a Few Clicks
If you use an online payroll deduction calculator, you’ve likely been printing a copy of the calculations each pay period to provide to your employee. There’s a good chance this doesn’t satisfy all the requirements of a pay stub.
Another downside to payroll deduction calculators is the inability to store year-to-date data. When it’s time to prepare T4s at the end of the year, you will need to create some sort of document, likely a spreadsheet, to figure out your employees’ yearly amounts.
Having to manually total all the pay periods in the year for each employee opens the door for adding and/or transposition errors. With payroll apps and software this step isn’t necessary. Not only does this improve the accuracy of your year-end payroll reporting, but this means you can prepare T4s by simply selecting them from your payroll provider’s list of reports.
Help When You Need It
Are you worried that payroll software comes with a steep learning curve? Here at Virtual Heights Accounting we use Wagepoint. There’s a reason they call themselves the friendliest payroll app. Not only do they have an extensive list of how-to’s on their website, but you can also chat with technical support if you need more help.
We love that Wagepoint integrates with Xero. This means you can easily import your payroll data into your general ledger, saving you even more time. To make sure you’re ready to prepare this year’s T4s, check out Wagepoint’s comprehensive guide to filing T4s and T4As.
While payroll software is another business expense, it’s one that will save you tons of time and headache every pay period. If you’d like to hear about our experience with Wagepoint or need help preparing your T4s, contact us to learn more.