This week marks an awareness campaign you might not have heard of before. Providing an opportunity to celebrate payroll professionals and “highlight that they do more than just push a button”, it’s National Payroll Week!
What is National Payroll Week?
National Payroll Week takes place on the 3rd to the 7th of September. It was established in order to raise awareness of the impact payroll has on the UK economy. Payroll professionals play an important part in many organisations, utilising numerical, organisational, and strategic decision-making skills to ensure payroll is handled with the utmost accuracy.
We’ve consulted our very own Financial Administrator Michelle (Shelley) Leonard to provide her own insights into the world of payroll, explaining what it is exactly that payroll entails, and how it impacts both employers and employees. Here’s what she had to say…
What Does Payroll Involve?
Payroll can be an extremely time-consuming and manual job. The functions of payroll can be summarised as:
• Calculating gross pay for all employees
• Calculating statutory payments
• Determining what payments are subjected to income tax and national insurance
• Calculating PAYE (Pay as You Earn)
• Calculating national insurance
• Calculating net pay
• Making payments to HMRC (Her Majesty’s Revenue and Customs)
• Paying the employees
• Producing documents for HMRC, employees and the accounts department.
How Does Payroll Affect Employees?
Payroll affects every aspect of the organisation, from the reputation of the company right down to the morale of its employees. For example, a late and inaccurate payroll might cause employees to question the financial stability of the organisation. This might compromise on the work climate within the organisation, resulting in underperformance.
In addition, the company has to ensure that its payroll activities adhere to the country’s tax obligations and comply with employment legislations. The efficiency of meeting tax obligations on time and upholding of legislative laws can further establish the organisation’s reputation as a stable employer.
How Does Payroll Affect Organisations?
The right global payroll solution helps to ensure that businesses maintain their momentum, complies with PAYE expectations, and have the ability to scale up or down to meet their needs. Payroll can also be used to provide valuable feedback for a business.
The most obvious feedback that payroll can show a business is whether or not it is making a profit and provide a better understanding of the cash flow. Salaries tend to represent a large proportion of company costs, so managing payroll properly is central to managing cash flow, which is of paramount importance to the overall running of a business. Because it goes on behind the scenes it can be easy to ignore the importance of, and how much work goes into, correctly managing payroll.
Finance is integral to business function and development. Here at Gibson Hollyhomes, we have recruited into the Accounts and Finance market since 2015. This includes businesses from family-run SME’s to global law firms, all of which are based in the Manchester and Leeds areas. If you are interested in a career in Accounting and Finance contact us today!