In the past, payroll was something that could be managed manually. However, following changes to the UK payroll system, implemented by HM Revenue & Customs at the start of the 2013 tax year, payroll software is now an obligation.

There are countless smaller and newer companies across the UK that are waking up to the latest changes introduced by HMRC. The new system that has been introduced is PAYE in Real Time. Unless a company is notified by HMRC that they are exempt from the new Real Time Information system, payroll information must now be reported in real time using this system.

The New RTI System

This new system is ‘real time’ because details about every employee’s pay and deductions must be sent to HMRC every time employees are paid. There is no way to do this other than to use commercial payroll software for the UK, or to use the free Basic PAYE Tools package available from HMRC.

This is the reason why you must now have a UK payroll application that supports RTI for the management of your payroll. Basic PAYE Tools is limited and does not support payslips, however there are free UK payroll software solutions available for small companies.

Relying On Manual Tasks To Manage Payroll

Of course, if you feel the need you can still take care of payroll calculations manually, but there are many reasons why this is not a good choice anymore. Given how many variables and considerations that are involved, it can be notoriously difficult to take care of payroll calculations manually.

And it is not just handling calculations that makes UK payroll software so beneficial; it is also the fact that they make it much easier to keep track of employees. Calculations and employee tracking can be managed with relative simplicity and efficiency by using a good UK payroll software application, so why do things manually when you can have software take care of things automatically?

Keeping Track Of Complex Payroll Variables

Good payroll software conveniently keeps track of many of the important payroll aspects, including PAYE/NIC tax, holiday pay and attachment orders – for all of the different payroll schedules including weekly, fortnightly and monthly.

There are lots of variables when it comes to managing payroll in a modern company (even for smaller start-ups with fewer employees) and it does not take much for things to spiral out of control when trying to keep track and calculate things manually.

We are now living in the land of digital, and whether your company manages payroll internally or instead uses a professional payroll agency, UK payroll software is now a must. With the right HMRC accredited UK payroll software it is becomes easy to manage your company’s (or your clients’) payroll obligations. The benefits of using such software go well beyond the benefits described in this article – read more articles on the subject to see how else you can benefit.