A payroll calculator can be one of the most efficient tools at your disposal when processing your employee's paychecks. Finding and choosing a good calculator, however, involves a bit more than getting one free or for the lowest price.
Payroll Calculators - What to Look For
One of the biggest considerations every small business owner has is time spent doing work that could be either delegated or automated. With the evolution of digital tools and online services, much of what you find yourself or your managers doing can and probably should be eliminated.
Using a payroll calculator, either online or as an app on your own computer, is a great way to reduce much of the tedious work involved in processing payroll every pay period. It can free you from having to do all the payroll tax filings and payments. This means keeping up with federal, state and local laws, regulations and changes. In addition, depending on the version you choose, you can have access to support for any questions or problems you might have.
Three Aspects to consider with payroll calculators:
- Free vs. Paid - Many businesses, usually payroll management service providers, will have free payroll or paycheck calculators available on their websites. But not all calculators are created equal and many free versions are basic and limited in their features. On the other hand, while fee-based or subscription-based calculators are almost always robust, full-featured tools, the cost can sometimes be prohibitive for very small businesses.
- Small vs. Big: One other thing you want to consider when deciding on an online payroll calculator is how big of an operation are you? If you only have, say, less than 10 employees to pay, then you might want to consider this alternative. However, if you have dozens or even hundreds of checks to cut every week to different vendors and suppliers, in addition to employees, then a full-service online payroll calculator and processing service may be a better investment.
- Simple vs. Service: Using an online tool or computer-based application can make your payroll processing life easier, but there can be a Catch-22 involved: the easier the program is to use, the less likely there will be ready support for it. Again, a free calculator may be simple and user-friendly, but it may not provide all the features you really need to make your job easier. And you may find there is little or no service support for the tool.
Features you will want in a payroll calculator:
- Computes federal and state tax withholding
- Social Security Tax
- Medicare Tax
- Disability Insurance
- Calculates flexible, hourly, monthly or annual pay rates, including bonus or other earning items
- 401k, HSA and other special deductions
- Provides for public employees and exempt employees paycheck calculation
- Includes Current year-to-Previous period information
- Ability to print pay stubs with detailed summary or paychecks
- Mobile functionality that allows use on a mobile app
While choosing and using a payroll calculator may be an interim step for your business. You may eventually decide to use a full-service payroll management services provider as your company grows. But it should still be a tool that serves your real needs in a real way. So shop around and try out a few before committing to one. It will be well worth the effort.