In simple terms, payroll is the money that employers pay to their workers. Generally, the term is used when referring to the process that is used to calculate wages and taxes for employees.
An employer's payroll is the sum of all the wages and salaries it must pay to its employees in a given period of time. Payroll includes salaries, wages, deductions, bonuses, and net pay.
Employers pay payroll taxes in two ways: one is out of their pockets, and one is collected from employee paychecks and remitted to the government.
Manual payroll systems require all payroll activities to be done manually. If you plan to do your own payroll, you can purchase standard timesheets for documentation and ask employees to complete them. After the time cards are completed, you can calculate the employee's wages and taxes, and then hand them their paychecks.
Software for payroll brought new levels of competition to the world of business operations. Using these software programs, the correct compensation owed to each employee can be calculated. Automation allows payroll software programs to track, maintain, and deliver pay to employees with ease.