Amit Kumar
by on May 6, 2022

Payroll processing is one of the most important functions of HR departments in any organisation. It is a critical process as it involves the payment of salaries to employees.This process begins with the collecting payroll information like hours worked, pay rates, taxes and deductions from all departments, calculating of employee salaries, accounting for leave, following tax regulations, among other things.


Challenges associated with Payroll Processing

Payroll is an essential, but also a cumbersome and repetitive task in any organization. It involves calculating salaries based on the time employees spend at the office, handling deductions for medical insurance, distribursing salaries, managing leaves and reimbursements - all which are not only time-consuming but also require a lot of manual effort.

The payroll processing has many challenges that must be dealt with, such as compliance with statutory laws and regulations, integrating your payroll with accounting systems, and the need to provide timely payments to employees. This can be especially difficult for organisations that have a large workforce.

One of the most common challenges is that of inaccurate calculations. This happens when companies or outsourced payroll processing company in Delhi use manual processes to calculate payroll. Employees may miss payroll deadlines due to incorrect data entry, or fail to update their records with new hire information. They might also make mistakes in calculating deductions for benefits and taxes. 

Another challenge that companies face with payroll processing is compliance with tax laws. To comply with central and state tax laws, companies must withhold taxes from employee paychecks and send payments to the government on time. Failing to do so could cause fines and penalties from tax authorities.


However, payroll processing challenges can be summarised:

  • Manual Payroll Processing
  • Improper management of leave and attendance
  • No automation in salary calculation
  • Incorrect salary calculation
  • No organization-wide visibility of salary structure
  • Human errors in payroll data entry and computation
  • Improper handling of statutory compliance
  • Risk of data loss and frauds in manual mode


How HRMS software can mitigate payroll challenges?

Human resource management systems (HRMS) can help you resolve these issues by automating every phase of payroll processing. This allows you to focus on other aspects of managing your workforce, such as hiring new employees or planning performance reviews. Additionally, HRMS software ca help in-

Calculating salaries accurately - With a built-in salary calculator that automatically calculates the salary of individual employees based on their attendance records and other details like leaves, overtime hours worked and so on, HRs can avoid any manual errors during calculations.

Distributing salaries - The software automates the process of salary distribution by transferring it directly to the bank accounts of employees. This saves administrative costs and efforts associated with the distribution of cheques or cash payments to employees.

Automating routine tasks- Payroll processing is a complex process and involves numerous tasks – data entry, calculation of wages, deductions, taxes etc. HRMS software automates all these processes so that you get accurate results every time without having to make any manual calculations or entries. Automating payroll can help HR professionals handle this task efficiently, without errors and in less time.

You can either outsource your payroll related tasks to payroll processing company in Delhi or configure your system with HRMS software.



Businesses are demanding more from their payroll professionals: they expect deeper insights, more accurate reporting, better feedback on employee timesheets, and a rapid response to any problems that crop up. At the same time, businesses also expect their payroll professionals to be able to stay in budget while they're doing all this.

In this environment of high expectations but low budgets, it can be hard for HR teams to see how they can live up to these demands without breaking the bank—which is why we're here to help. Is there any way for your HR team to handle payroll challenges? The answer is yes! A human resources management system (HRMS) can help you get the job done by streamlining processes and providing insight into your employee data.

Posted in: software, Technology
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