Online accounting solutions are huge assets in making the lives of SMBs (or any kinds of businesses) easier. However, there is a feature that still can be considered a black sheep, even though it’s one of the most important parts of accounting: payroll. Thankfully, the best-known accounting solution providers have recognized the importance of payroll, building it into their cloud-based software. This way, employees can not only manage their own work schedule using time trackers, but they can also get paid through the very same program. Furthermore, the lack of a payroll feature is not a hindrance anymore. Thanks to API support, you can integrate many different payroll applications into your accounting solution and make payday and payroll tax filing a hassle-free, fully-automated process.
Payroll Features in Accounting Software
One of the best things about payroll is that it auto-manages the entire process. All you have to do is to either enter the timesheet of your employees, ask them to submit their own timesheets, or use a built-in/integrated time tracker, and then the accounting software will take care of the rest. In fact, the payroll feature can also handle ‘deviations’ in the regular payroll schedule, like vacations, sick leave, and bonuses, as employees can individually apply for leave even when they are out of office. Employees are also entitled to receive their individual payroll reports, which you can also give to your accountant – who can have full access to your payroll to help you verify data in preparation for tax season.
Speaking of taxes, not only does the software calculate the taxes you have to pay (and in some cases even allows you to file tax reports right away), but it can also remind you when payday is due and give you the option to decide how you’d like to pay your co-workers.
Best Online Accounting Software of 2024
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Integrating Third-Party Payroll Solutions
Unfortunately, payroll is a feature that not every online accounting solution provides. However, what these programs can do for you is offer the option to integrate a third-party app with your software, so you can manage payroll after all. In fact, some of these apps are capable of something the built-in payroll solutions of accounting software aren’t: auto-filing the necessary tax reports in every U.S. state. Furthermore, each time you run payroll, it reduces the chance of manual errors and common mistakes by removing duplicate entries that might have been left by calculating ordinary hours, penalty hours, overtime and allowances – making the end of the month completely hassle-free.
Although there are plenty of third-party applications supported by online accounting solution providers, one of the most popular third-party payroll services is Gusto. The app automatically calculates, files, and pays your taxes – it even adds insurance costs and prepares your 1099s.
Recommended Online Accounting and Payroll Software
Not too many online accounting solutions have built-in payroll features, or if they do, they are often pay-only. However, if you want to make sure that everything is in one place, or you want to replace the existing payroll feature with a huge variety of third-party add-ons, then Xero and QuickBooks Online, two of the market leaders, might be your best option.
Xero
An undeniable champion in the online accounting world, Xero offers everything a business needs including clever invoicing, expense management, time tracking, and, of course, payroll. The keyword in Xero’s payroll is collaboration, since employees can submit their own timesheets, time-off requests, and more. Employers can directly pay them via check, bank remittance, or cash based on any payment schedule and even send detailed payroll reports to employees. Furthermore, you can say goodbye to late and miscalculated payments, since not only do you get payday notifications, but you can also apply multiple pay rates and even reimburse expenses. Xero also calculates the necessary taxes you have to pay and, in certain states, you can immediately file your tax reports from the software. Although Xero’s payroll is pretty good, the company offers you the option to integrate your account with the best payroll solutions on the market like OnPay and Zenefits.
QuickBooks Online
Whether you want to do your payroll taxes by yourself or pay more to get it done by experts, you can be sure that QuickBooks Online can handle your payroll with ease. You can run payroll as many times as you want from your computer or mobile device. QuickBooks is able to pay directly by check or bank deposit, while taking vacations, deductions, and garnishments into consideration. Employees can also access their online paystubs, while employers can be reminded of the paydays and due taxes via email notifications. Speaking of taxes, QuickBooks can deal with payroll taxes, since you can prepare the necessary documents and file them right away to the IRS or ask the company to do the “dirty work” for you. Last but not least, if you already rely on a payroll solution, chances are you can integrate it into QuickBooks, since the company supports market leader applications like ADP and Paychex.
Best Online Accounting Software of 2024
Rank | Provider | Info | Visit |
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Editor's Choice 2024 |
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