Processing of the payroll requires an understanding of taxation and compensation regulations. However, small businesses may not have a dedicated payroll personnel to process their payroll. Because, besides the need to be in compliance with the law, businesses are also mindful about the cost of processing the payroll. So how to handle payroll for small business in the Philippines? And what are the things to look out for?
Payroll in Microsoft Excel
Most small business prefers to handle their payroll themselves because it is free. Besides, with a smaller number of employees and less complicated compensation structure, the processing of payroll for small business would be simpler and faster. Therefore, many of them choose to process their payroll using Microsoft Excel.
Although the payroll for small business is simpler, businesses may still commit mistakes in the computation of the payroll. In order to ensure high accuracy of computation, these businesses should generally possess a certain level of expertise in Microsoft Excel to create a new or to modify a downloaded payroll template to suit their needs. And they should also regularly update the payroll template to reflect any changes in regulation.
So one of the issues when handling payroll for small business using Microsoft Excel is the updating of the payroll template. Another common issue is the process of rectifying the payroll errors if any.
However, if you use excel to process your payroll, you can use this free excel timesheet with formulas that automatically calculates the number of hours of undertime, overtime and night shift differential.
Another way of handling payroll for small business is through the use of payroll system. The number of small businesses using payroll system in the Philippines has been steadily increasing over the last few years. Besides, with the rising competition in the ERP industry, many of these payroll systems also provide a free version or trial period that small businesses can take advantage of.
Some of the free payroll systems limit the number of employees that a business can process in a month while others may require the businesses to pay for their premium features. Therefore, when choosing the free payroll system to use, the business needs to understand the constraint of the system and if it suits the business needs. Most importantly, the system must be able to process the payroll for small business in the Philippines.
Outsourcing of payroll for small business may be the easiest way to process payroll. It helps the small businesses to save time, effort and take advantage of the outsourced company expertise in processing of payroll. Due to the nature of their service, these outsourcing companies are also naturally required to be constantly updated and be in compliance with the latest regulations. So the small businesses can have a peace of mind knowing that they have an assistance of a payroll expert. Furthermore, these outsourcing companies also help to prepare monthly, quarterly and annual government forms and other reports for their clients.