Payroll processing and HR management
What is Payroll processing?
The company’s payroll is a list of employees that are paid. The entire amount paid to workers by the company is referred to as payroll. The formulation of an organization’s pay policy, which includes flexible benefits and leave encashment policies, is part of the payroll function. Payroll administration also includes obtaining additional payroll inputs such as the organization’s food vendor supply, as well as basic, variable pay, HRA, and LTA payslip components.
Payroll and HR management also entails paying workers, depositing dues such as TDS, PF, and other taxes with the proper authorities, and submitting returns. The computation of Net Pay after tax adjustments and other deductions is included in payroll processing.
HR management and payroll processing
- Due to the many compliance regulations in India, payroll processing and HR administration is a highly complicated undertaking for most small firms.
- Most companies lack a well-developed HR system and practises, resulting in inconsistencies in attracting top talent, keeping good workers, and even establishing a productive workplace culture.
- An individual may experience a stress-free and error-free payroll cycle every month by outsourcing payroll and HR administration to SRCC.
- Our HR specialists may also assist with the implementation of world-class HR procedures in the organization from the start to support the company’s growth.
India's payroll processing
Creating a pay policy
The first step is to develop procedures for dealing with the bank throughout payroll operations. These policies must be accepted by management before they can be turned into standards. Pay policies, attendance policies, leave and benefits policies, and other policies are only a few examples.
At this point, inputs are received from several departments to ensure that the payroll is calculated correctly.
Validation of input
Once the data has been obtained, it is critical to double-check its accuracy because even a minor error can derail the entire payroll process.
It’s crucial to make sure the list comprises all active workers and no records of inactive personnel. Examining the data to see if it complies with corporate policy. Ascertain if the present is in the proper format.
Calculation of Payroll
The verified input data is sent into the payroll system for real payroll processing at this stage. After deducting the appropriate taxes and other deductions, the result is the Net pay.
To minimize future errors, it’s usually a good idea to reconcile the figures and double-check the correctness after the payroll process is completed.
Statutory compliance post-payroll
Statutory compliance must be strictly followed by the payroll administrator. During the payroll processing, several statutory deductions such as EPF, TDS, and ESI are deducted. Following that, the deductions are made to the appropriate authorities or government entities.
Accounting for payroll
Every organization is expected to have proper books of accounts, and one of the key items in the books of accounts is the wage paid.
After following the processes outlined above, wages can be paid in cash, check, or bank transfer. It is preferable to establish employee salary accounts for smooth transfers.
The next stage is to produce a report, which must include correct information such as department or location-based staff costs.
Payroll management in Excel
When a business is just getting started and has only a few employees, excel-based payroll administration is the way to go.
The computation is done on excel sheets using the standard payroll calculation template in excel-based payroll administration. The payroll officer’s calculations are aided by the mathematical formulae that have previously been established. However, there are several flaws with this technique, like
- Because the data is input manually, there is a high risk of clerical and mathematical mistakes.
- Adding and deleting employees from the payroll list is difficult.
- Duplicate data and omission of entries are possible.
- It is necessary to keep track of tax modifications as well as other legislative changes such as PF, PT, and so on.
India's payroll processing
When the payroll function is outsourced, it is handled by an external agency. Every month, the payroll service provider offers different other data, such as attendance, leaves, and reimbursement details, based on the pay cycle.
The external service provider then calculates the payroll and ensures that all legal requirements are met. Because payroll is such an important job, SRCC can assist you in meeting all of your requirements.