Admit it. New Zealand Payroll processing is a complicated business. You must track all your employees’ hours, calculate their wages, withhold their taxes, Kiwisaver and other deductions, deposit their payments, navigate the payroll software, and keep up-to-date on the latest payroll procedures and regulations. That’s a lot to manage!
Who processes your payroll? Whether you do it in-house, hire a third party, or plug your team’s hours into the software yourself, your payroll service will need to provide the following:
Needless to say, we live in an age where an Excel spreadsheet or sheet of paper is no longer adequate to manage a company’s payroll but fear not. We here at 3rd Arm Admin have provided you with your guide to the basics of payroll. Read on to learn about the different services and systems you can use to process your payroll.
Internally managed payroll usually means you have at least one employee whose primary job is to administer your payroll. Managing your payroll internally also means more than just getting the payroll out on time. Regardless of the size of your company, handling your own payroll is a viable option but you’ll still need to stay abreast of any changes to income tax law and payroll regulations. You’ll also need a system in place to examine and audit your own payroll procedures and ensure compliance with legislative changes.
Our payroll here in New Zealand is complicated and employers outsource for many reasons, possibly for confidentiality, certainly to manage the complexities of the payroll, and often because of the complex knowledge required to manage your payroll successfully and keep abreast of the ever-changing requirements. When outsourcing your payroll, your books go to an outside office who process your payroll for a fee. That’s where the bookkeepers step in.
Third-party, professionally managed payroll systems can complete as much or as little of your payroll as works for you and your office. It can be everything excluding providing the hours worked or as little as just filing the IR reports and every scenario in between.
With an online payroll service, you plug your payroll numbers into the software, and your payroll reports are calculated (sometimes within minutes). Outsourcing your payroll to an online service can be simple, cost-effective, and easily integrated with your existing books. You do need to remember that any payroll software is only as good as the information keyed into it, whether it be in the initial setup or the weekly, fortnightly or monthly processing. The adage rubbish in equals rubbish out applies for all software.
Our payroll in New Zealand is complicated. Goodness, even the Govt Departments that manage the accuracy of employees’ payroll are not always able to get it right. As we mentioned above, rubbish in equals rubbish out. Most employers want to ensure they are paying their staff correctly but often it is a case of not knowing what you don’t know, and if your payroll software isn’t set up correctly then the outcome will still be incorrect, no matter how good the intention. That is where you need to have your payroll audited to ensure correct record keeping, leave calculations, finals pays, and stat holidays pays to name but a few.
You know what makes your business different. You know what makes it special. You know what you will need in the perfect payroll system. If you’re looking for a welcome dose of expertise in your payroll processing, contact us at 3rd Arm Admin today to schedule a consultation.