A payroll management system is a computerized system that is used to calculate, manage and store employee payroll information. This system can be used to track employee time, calculate wages, withhold taxes and deductions, and generate pay stubs and payroll reports.
Payroll management systems can be used by businesses of all sizes, from small businesses to large enterprises. These systems can be purchased as stand-alone software or as part of a human resources (HR) or accounting software suite.
How Does a Payroll Management System Work?
A payroll management system automates many of the tasks associated with payroll processing, including time tracking, wage calculation, tax withholding, and pay stub generation.ime tracking is typically done via an online timesheet, which employees can use to punch in and out or track their hours worked. This information is then imported into the payroll system, where it is used to calculate wages.
The payroll system will also withhold taxes and deductions from employee paychecks. This includes federal, state, and local taxes, as well as deductions for things like health insurance and retirement savings. Finally, the payroll system will generate pay stubs and payroll reports.
