Benefits of Cloud Payroll
If you’re accustomed to a traditional payroll processing system, you may be wondering why you should move to a cloud-based payroll system.
In this article, we’ll take a look at the benefits of payroll in the cloud and show how they can quickly save you time and money.
What is “The Cloud”?
It’s a different way of storing, accessing and processing your business data.
By moving to “the cloud”, you can use your computer or smartphone to access your company data and software applications from anywhere. You don’t need to provide computing and network infrastructure yourself, apart from the device you use to access the internet. The cloud service provider handles all the storage, software updates, availability and processing in return for a simple monthly access fee.
What Are The Benefits Of Cloud Payroll Vs Traditional Payroll Systems?
If you use a traditional payroll system, you will likely use software that runs on your in-house computers. Just like cloud computing payroll systems, you input your payroll data and the software generates payroll information. Perhaps you use an Excel spreadsheet or a manual wage book.
However, traditional payroll systems suffer from a few drawbacks.
Firstly, there is a maintenance overhead. You need to make sure the software is updated. If there is a problem with how your machines run the software, this may require costly support services.
Cloud payroll solves this problem by removing the need for payroll software on your computers. All you need is an internet connection. The cloud payroll provider looks after all the software updates, maintenance and hassle from their end.
Secondly, the risk of data backups. Again, backing up data is an administrative overhead – an overhead that comes with significant risk. Backups can be corrupted, they can fail, and the data is typically only stored in one physical location. Have you tested your backups recently?
Cloud payroll systems are backed up constantly and looked after by expert, dedicated technicians.
Thirdly, data security.
People often wonder if their data will be safe in the cloud, but when you compare the security risk of storing all your company data in a single office, or on a single machine, the risk profile of cloud computing is compelling. A single office is vulnerable to theft, fire, employee interference and a multitude of other situational risks.
Payroll data on cloud applications is subject to bulletproof security, multiple data storage locations that provide redundancy and enterprise level backup – without the enterprise level infrastructure cost. SmartPayroll has advanced encryption and hardware and software firewalls to keep your information safe and confidential. Additionally, because your records are stored in the cloud, you can access them anywhere, anytime.
If you’re using manual systems, like a spreadsheet or wage book, these systems suffer from the same potential security and data loss issues, and they don’t provide any smart information around changes to legislation. You need to spend extra time and effort keeping up with all the changes.
Keeping Up With The Government
Tax and other legislation that affects your employees, your payroll and business is changing all the time.
Cloud-based payroll systems incorporate all the applicable changes to legislation. The software updates happen seamlessly in the background, so you can be assured that whenever you execute your payroll run, you are fully compliant with the latest legislation and IRD directives.
This will keep both your accountant and the taxman happy!
Cost Of Change
Some people will be worried about the switching cost.
You’ve run your existing system for years, and your staff are used to it. Any change to another system involves some time to make the switch and get used to a new way of working. A switch to cloud computing is no exception.
However, providers like Smart Payroll address this problem by having New Zealand based support staff set it all up for you. We want to make the process genuinely easy.
Compare this to the cost of retaining and maintaining an inefficient system and the switching cost becomes negligible.
But Is Cloud Payroll Easy To Use?
Yes, it is very simple to use.
Cloud software makes it easy to integrate your payroll system with other software, too. For example, some systems, like Smart Payroll, integrate seamlessly with Xero, a popular cloud-based accounting package.
In fact, it is so simple, you can run your payroll on a smartphone! With the SmartPayroll Auto Pay function, you can pay your staff in less than a minute, do all the calculations, make the payments and lodge PAYE with the IRD.
How does this speed and ease of use compare with your existing Payroll system?
Cloud Payroll Can Save You Money
Perhaps the greatest benefit of cloud payroll is the cost saving. Cloud payroll creates many cost efficiencies including:
- Cutting the time it takes to process payments by automatically filing PAYE and automatically paying staff and emailing payslips
- Keeps up to date with legislation
- Provides accurate record keeping
- Eliminating most network, backup and software administration overhead
This frees up your time and lowers the cost of your payroll processing.
Payroll is obviously a tedious administrative overhead. Like most business owners, you want to focus on running and growing your business, not dealing with excessive administration and the resulting overhead and frustration.
Cloud software systems have become incredibly popular, especially with small and medium-sized businesses, because of the ease of use, low barrier to entry and affordable cost.
Please check out our guides for further information or give us a call on 0800 10 10 38.
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