The right payroll software can streamline your payroll process, reduce the number of errors, and free up hours of time every month in your business.
Making sure your employees are paid correctly and on time is vital.
But payroll software can do so much more – from creating reports and monitoring data to managing leave and tracking tax.
In saying that, not all payroll software is created equal: what works for one business may not be the best solution for you.
In this article, we’ll look at five payroll management options in New Zealand and list the pros and cons of each. Then, you can choose the right payroll software for your business. Let’s roll!
Which Payroll Software Is Right For Your Business?
1. Spreadsheet
Okay, so technically, a spreadsheet isn’t payroll software, but it’s what many businesses use to manage their payroll every month. Most computers come with a spreadsheet program, or you can use a free cloud-based option like Google Sheets to keep track of everything.
Pros
The best thing about using a spreadsheet is that it’s free! Nothing to download and no subscription fees to worry about.
Another benefit is that it’s relatively straightforward. Most people already know how to use a spreadsheet. If you know the basics of using a spreadsheet, you’ll be able to navigate the system pretty well without any bells and whistles.
Cons
We’re inwardly cringing at the thought of you using a spreadsheet!
The simplicity of a spreadsheet is also the downside of this system. Everything must still be entered manually, including Payday filing.
There’s no feature to automatically calculate annual leave balances, leave payment types, or lump sum pay rules. This is hugely risky if you don’t calculate these items correctly.
Doing things this way might work if you have one or two employees. But, it will be more time consuming than automated software – particularly as your team grows.
2. Xero
As one of the most well-known accounting programs in New Zealand, it makes sense that Xero also offers payroll software. If you already use Xero, it can make sense to utilise the payroll add-on, which is a good, low-cost option.
Pros
A great option for staff members who have a regular working pattern (i.e. salary) or those who receive 8% of their earnings paid as they go. The pricing is competitive, as are the integrations, and there are plenty of features to help streamline your payroll.
Cons
Xero payroll software requires significant manual intervention to correctly calculate leave entitlements.
It lacks the ability to import or download timesheet entries, and there is no rostering capability.
Reporting is very limited, it’s not a PAYE intermediary, and there are no automated coding splits.
3. iPayroll
iPayroll is a viable option for businesses of all sizes. It comes with human resource features on top of a range of payroll features.
Pros
Unlike some of the other choices here, iPayroll is a payroll intermediary. That means they can direct debit your bank account and distribute funds to your employees and the IRD.
Reporting options are comprehensive, and free training and support are offered to get you up and running (as well as free ongoing support).
Cons
Using iPayroll may impact your cashflow as IRD payments are paid to the platform at the same time as the pay run, even though they may not be due for another four weeks or so.
This is one of the more expensive options on our list.
4. SmartPayroll/Smartly
SmartPayroll has been relaunched as Smartly, and the new name came with increased functionality and expanded features. Smartly is presented as an all-in-one solution for all your payroll needs.
Pros
Like iPayroll, Smartly is a payroll intermediary.
There are plenty of features for whatever you need, as well as free training and support.
A one-month free trial is available.
Cons
Similarly to iPayroll, there could be cashflow impacts because of the way IRD payments are made in this payroll software.
Additionally, there are only two systems earning codes, so you’re restricted on the types of regular payments you can make to employees. This can make it tricky if you have multiple pay rates covering different scenarios.
Leave accrues in hours, not the legislated weeks, and the reporting options are somewhat restrictive.
Lastly, the pricing can be confusing and unclear, with hidden fees popping up.
5. PayHero
At Admin Army, PayHero is our preferred software. It’s packed full of easy-to-use features and can handle some basic-level HR management as well. PayHero integrates with or accommodates many other platforms, so it will most likely work with other programs you use in your business.
Pros
PayHero is the best software for calculating leave entitlements for employees with irregular working patterns.
It has excellent reporting capabilities, with customisable graphs and tables. If you can dream up the data, you can most probably export it from PayHero.
There are also add-on software options for rostering and clocking in, and the mobile app is intuitive and straightforward to use.
Cons
Because this software is so feature-rich, it’s one of the pricier options on the market. However, you can choose from three different plans, depending on your business size and requirements. And as the old saying goes, you get what you pay for.
Which Payroll Software Should You Choose?
Aaah… the million-dollar question. When choosing between payroll software options, pricing is a factor, but should never be the only factor. Consider user-friendliness, the amount of support available, how easily it integrates with other systems, and whether it has the features you need (such as advanced reporting or HR functionality).
Using payroll software is a fantastic idea for every business. It saves you time, reduces the likelihood of errors, and allows you remote access from anywhere at any time.
Although some come with a slight learning curve, once you’ve mastered the basics, you’ll find payroll so much easier!
If you aren’t sure which payroll system is right for your business, then have a chat with the team here at Admin Army. We are payroll experts and can recommend the right software for your needs. Drop us a line today!