Accounting & Finance

How Cloud Technology Is Simplifying Global Payroll

Sep 20, 2022

Even if you believe that you already have a great payroll system, cloud technology is continuing to improve HR processes.

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William Delong - Guest Contributor
How Cloud Technology Is Simplifying Global Payroll

What we'll cover

Is your legacy payroll system outdated and you’re looking for a better way to pay employees?

Paper checks are becoming a thing of the past, as 93% of Americans [1] receive their pay via direct deposit. In fact, Walden University [2] estimates they'll go away completely by 2026. And that means your company needs a robust and simplified payroll system to pay your employees quickly and efficiently.

Yet, companies still face payroll challenges, even in this high-tech age of interconnected technology that makes our lives easier. This is where cloud technology can come in to help streamline your HR processes. 

Identifying common global payroll challenges

A survey from Deloitte [3] identifies several common global payroll challenges that companies face in a modern business environment.

Determining tax withholding obligations for employees is one top concern. Not only do workers have various legal statuses (married, single, immigrant visa), but some jurisdictions may require regional, provincial, state, and local taxes to be withheld. Payroll may see wage garnishments from a government agency, too. You may have to manage different currencies, exchange rates, and laws for withholding taxes in multiple federal-level governments if you're an international company. Keeping track of these obligations takes away valuable staff time when processes aren't automated with software.

Then there's the other side of the withholding equation: reporting these amounts to tax agencies. Your reports must be accurate to avoid issues when your company files its own tax returns and employees file their returns if required.

At the end of each tax year, your payroll system must aggregate employee data to compile tax documents for all employees. Forms may vary from jurisdiction to jurisdiction. You may have to deal with contractors, freelancers, and others working from home using their own equipment, which could change tax obligations for parties, too. Tax management always has a set of challenges, particularly when tax laws vary from year to year.

The pandemic changed many business owners' minds about technology adoption, including payroll. That's because more technology became a necessity with remote workers, and 40% more companies [3] chose to develop a payroll strategy since the pandemic started, as compared to the last time Deloitte ran a similar survey.

Perhaps it's time to reassess your payroll system now that technology has improved and prices have become competitive due to many available options. Cloud-based systems are fast becoming the way to go.

Benefits of using cloud technology for global payroll 

The global HR payroll software market reached $23.5 billion in 2021, and industry experts predict it will skyrocket to $52.9 billion by 2030 [4]. The right payroll system can integrate and organize complex business and company processes into one platform.

Cost savings

Cloud-based payroll systems lower your overall costs in several ways. You don't need to purchase new hardware; just use what you already have on hand. Your existing computers and mobile devices can connect to a secure app or platform.

Centralization

All of your payroll information exists in one place for stakeholders to see, depending on their level of access. Employees can log in from their mobile devices to see what an expected direct deposit will be on a given week, their current withholdings, and tax documents they need to file returns. Meanwhile, administrators on the account can receive up-to-the-minute reports on overall labor costs, easily input raises, and calculate bonuses. 

Real-time insights

Your administrators and owners can glean real-time insights from payroll data for futurecasting. Are you at a point where you may need to hire more people? Can you invest more money in other projects with cost savings alongside new contracts you brought in? Do you need to add workers to another shift to compensate for higher production?

Legacy payroll systems often simply get the work done for paying employees and managing taxes. They don't compile disparate data points like incoming revenue, outlays, and other accounting data to assist with managing staffing levels. Data analytics from a comprehensive platform can help your team gain insights into seasonal fluctuations, employee efficiency, and staffing levels.

Improved employee experience

Payroll systems streamline operations for HR staff but also non-HR employees. Onboarding becomes easier when documents are signed digitally and in the cloud rather than on paper. Employees can access their information at any time from anywhere, and they can make changes to their information when necessary.

What to look for in a cloud payroll solution

When investigating your best cloud-based payroll solution, look for these key differentiators:

  • Ease of adoption. Cloud-based systems should easily integrate into your existing hardware.

  • Compliance automation. As a global company, your payroll system should automate your compliance requirements based on where employees are located, the currencies they require, and the laws of where your business operates.

  • Regular updates. As new tax laws are passed, your payroll system must update automatically to keep your HR team informed of what's happening. Updates should also occur when operating systems improve and glitches are found with new software releases.

  • Scalability. When your company grows and your needs change, a cloud-based payroll solution should allow you to expand alongside you to include new offices, new employees, and new tax jurisdictions.

You'll need a partner to help you find your next payroll software solution.

Shop around for a new payroll system to take your company higher

With so many choices available, upgrading to a new payroll system should be easy. Whether you want a comprehensive system that integrates with other programs or basic software that only focuses on payroll and tax compliance, your company can find one that fits your requirements. GetApp can help you find the right software for you.

Want to find out more about cloud-based payroll?

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About the author

William Delong - Guest Contributor

William is a professional writer and editor specializing in a variety of industries including legal, medical, marketing, and technology. He has over 13 years of experience delivering SEO-focused and engaging content.
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