Payroll System

Created by: TinaCoolBeansSarg
Created on: 16-09-14 23:13

A payroll system consists of the records and calculations needed to work out the payments and deductions for every employee of a business

It is crucial that payroll systems are secure and reliable so that employees are paid the correct amounts at the right time.

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Employees receive a payslip that itemises the payments and totals them to make the gross income.

Some of the payment tasks undertaken include: salary or wages, overtime, holiday payments, bonuses etc

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Some of the deduction tasks include: income tax, national insurance, student load deductions etc

The deductions are also itemised and subtracted from the gross income to give the net income, the amount that is actually paid to them

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Very careful records need to be kept so that the correct amounts can be transferred both to employees and to external bodies such as the Inland Revenue.

Any payroll system must be able to deal with events such as when an employee leaves the business or when a tax rate changes.

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Payroll can be outsourced where work is carried out by a specialist company

Payroll can be managed inhouse using electronic payroll software that can be bought from a number of suppliers

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Use electronic funds transfer (EFT) using BACS (Bankers’ Automated Clearing Services) to transfer the money between the organisation’s bank account and the employees’ accounts. Use of the system to make payments to the Inland Revenue of income tax

Used for the input of time sheets/data from clocking in machines, etc., so that information can be input quickly and accurately

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Other cards in this set

Card 2

Front

Employees receive a payslip that itemises the payments and totals them to make the gross income.

Back

Some of the payment tasks undertaken include: salary or wages, overtime, holiday payments, bonuses etc

Card 3

Front

Some of the deduction tasks include: income tax, national insurance, student load deductions etc

Back

Card 4

Front

Very careful records need to be kept so that the correct amounts can be transferred both to employees and to external bodies such as the Inland Revenue.

Back

Card 5

Front

Payroll can be outsourced where work is carried out by a specialist company

Back

View more cards

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Payroll System