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Small Payrolls

As we move, inexorably it seems, towards RTI am I alone in finding it much quicker - and cheaper - to do small payrolls of up to, say, three employees by hand in the traditional way than use some over-engineered software ?

I can have the job done in the time it takes me to open up the program.

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Just use Excel

No need to religiously fill out P11 cards. Just do it on a spreadsheet and let it work out tax, employee NI, employer NI, net pay and PAYE.

Just update the free pay figure as you would on a P11 card and let the spreadsheet do the rest.

Obviously you need to enter the NI thresholds and make sure you are not under or over in any particular month, but you can use IF functions for that. Same goes for 40% tax if the employee is a higher rate taxpayer.

It works fine for small payrolls like yours. As you say, no need to buy software just for 3 employees.

Chris

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They are not all over engineered

Payroll was always the best candidate for computerisation but traditional payroll software has followed the same path as deskbound bookkeeping (such as Sage & Quickbooks) in not being allowed to stay as basic compliance software and being burdened with extra buttons and functions.

With online systems there is just not enough power & bandwidth to cope with such systems (thank goodness) and so the providers have started from scratch just giving you just the essential bits.  I use MYPAYE but there are several others (PAYROO looks good and is free to many) and it takes seconds to process the payroll and send out emailed payslips.

So, in answer to your question, no, there is no way I'd go back to paper or spreadsheets, especially with RTI nearly upon us.

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I am with Paul
Me neither.

Captain

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Paper?! No way

I use Moneysoft payroll manager.

Just did a weekly payroll for six staff and e-mailed payslips and month end employers report, this took less than ten minutes.

 

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I last prepared a manual payroll in ...

1968!

We now use Moneysoft and for the price can't see the point in trying to muddle through with spreadsheets. However we are processing payrolls for around 30 clients so the cost is well spread.

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"I can have the job done in the time it takes me to open up the

"I can have the job done in the time it takes me to open up the program."

Not if you use Moneysoft you can't!! Download it for free and try it.

I too used to do payroll by hand until Moneysoft came out and when I changed, it saved me HOURS each week/month.

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You must be a very fast writer

If you can do manual payrolls quicker than a person with a computer, software, printer and email, then I take my hat off to you.

I am not going to call you a liar, but I do find your story a little incredible.

 

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Can payroll software prepare a year in advance?

Using Excel a year's weekly (or monthly) payroll can be prepared a year in advance - a single task rather than 52 (or 12) tasks.

Can any of the praised Software packages do this as well I wonder?

If they can how easy is it?

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Well.....................

DMGbus wrote:

Using Excel a year's weekly (or monthly) payroll can be prepared a year in advance - a single task rather than 52 (or 12) tasks.

Fair enough - but only if the weekly/monthly pay does not alter. Most of my payroll clients have differing staff hours every week.

DMGbus wrote:

Can any of the praised Software packages do this as well I wonder?

If they can how easy is it?

I can only speak for Moneysoft but it is as easy as pressing ALT+Enter to copy the gross pay and other details to the entire year. By the time you have prepared payslips etc which are all done automatically, Moneysoft is going to leave Excel standing.

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Yes - Moneysoft lets you fill in a complete year in advance, and even has a copy feature so the first week or month entered can be copied to the rest of the year.

Unfortunately for those who bill by time it only takes two seconds!  

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There is no way a manual system could beat Moneysoft in my opinion, download the trial and give it a go for yourself.

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Moneysoft is basically a spreadsheet input

The input screen for Moneysoft is basically a spreadsheet - with periods down the side and pay and deduction elements across the top for each employee - so Moneysoft gives you all the advantages of spreadsheets plus the assurance that someone else is maintaining the formulas for you each year.

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Thanks for all your comments,

 

Maybe I am a dinosaur.  On the other hand, most of my clients' employees get paid the same every week and their tax code lasts all year.   I look up the NIC once a year and the free pay once a year.  Working the tax out at 20% couldn't be much easier.  I'm still not convinced but I'll look at what you recommend.

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PAYE is not that easy

lionofludesch wrote:

Thanks for all your comments,

 

Maybe I am a dinosaur.  On the other hand, most of my clients' employees get paid the same every week and their tax code lasts all year.   I look up the NIC once a year and the free pay once a year.  Working the tax out at 20% couldn't be much easier.  I'm still not convinced but I'll look at what you recommend.

Working out the tax at 20%?

Don't you mean working out the free pay for the week/month in question, subtracting it from the cumulative amount earned, and working out 20% of that (assuming that the employee isn't a higher rate tax payer), following the rounding rules specified by HMRC every step of the way. Just because someone earns the same every week, it doesn't follow that their PAYE is the same every week.

Setting up an Excel template to do all of that properly would be a job strictly for professional developers only. Particularly when you add in correct handling of 0T (for which the free pay rules are different to all other codes), BR, D0/D1, and K codes.

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So many problems, Tom.  Week

So many problems, Tom.  Week 2's free pay is twice week 1's.  Week 2's taxable pay is twice week 1's as well.   That's how it works.

 

For 95% of the employees for whom I do payroll, there's no problem.

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Perhaps the compelling reason is that the software systems mentioned above will sort out RTI for you (your original point).

Good luck with whichever route you take (especially if you stick with spreadsheets!).

Captain

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Furthermore, are none of the employees directors?

Getting directors NI right is non-trivial in the case where salary exceeds the secondary threshold. Even if you calculate their NI like an employee during the year you still have to calculate the final period of the year using director's NI calculation rules (bearing in mind also the pro-rata adjustment in the case where the directorship began during the tax year, which like PAYE and the rest of NI calculations has very strict rounding rules). It all gets a lot worse if a director reaches retirement age during the year, too.

The thing is, doing it yourself in Excel you might not even notice or be aware of such complications. Whereas decent payroll software will handle all of this for you completely invisibly.

There is a reason why it isn't easy for software developers to get payroll accreditation from HMRC.

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brings back nightmares

In 1985 I was working at the head office of an employment agency. Implementation of a new payroll system went horribly wrong and I worked all day, through the night and all morning preparing the payroll by hand. There were hundreds and hundreds of temps, with new starters, leavers, overtime payments, changes in hours, pay, PAYE coding etc etc

Still never want to look a manual payroll in the face ever again!

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Basic PAYE Tools

How about Basic PAYE Tools from HMRC?

Works for up to 9 employees - and it is FREE.

For information see Business Link here

 

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Sage Payroll solutions are RTI Ready

At Sage we understand how disruptive RTI will be for employers and Accountants alike in particular the processes you all take in ensuring employees are paid on time and accurately.  We have shown particular interest in how we can reduce the burden on Accountants when processing and submitting for clients across a range of companies. 

At Sage we are taking RTI really seriously and have been working with HMRC for over a year now and will be participating in HMRCs 2 pilot stages(April 2012 to October 2012) and soft launch (i.e. early adoption Nov 2012 to March 2013).

Our Sage Payroll software update for the 2012/2013 delivered as part of our Payroll Year End pack is 'RTI Ready'. 

Accountants and customers alike tell us their No 1 requirement is to remain legislative compliant, and we will be doing this without passing on any costs to ensure you are "RTI Ready".

Why not join 485 thousand businesses in the UK who choose to pay more 7.5 million employees with a Sage Payroll solution (that's 1 in every 4 employees)....

You can find out more on our RTI landing page (www.sage.co.uk/rti) and if you are a Sage Accountant and want to be part of the early adoption for your clients there is a link to sign up!!

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At Sage we understand how disruptive RTI will be for employers and Accountants alike in particular the processes you all take in ensuring employees are paid on time and accurately. We have shown particular interest in how we can reduce the burden on Accountants when processing and submitting for clients across a range of companies.

At Sage we are taking RTI really seriously and have been working with HMRC for over a year now and will be participating in HMRCs 2 pilot stages(April 2012 to October 2012) and soft launch (i.e. early adoption Nov 2012 to March 2013).

Our Sage Payroll software update for the 2012/2013 delivered as part of our Payroll Year End pack is 'RTI Ready'.

 

Personally, I've found Sage difficult to deal with.  It has far more features than I need and the pricing structure isn't good.  Great if you have 100 employees at one company.  Not so good if you have ten employees spread over six clients.

 

For the three employers I have with one employee, definitely not as quick as the paper P11.  Far too many boxes to click on.

 

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At Sage we understand

neilson.watts wrote:

At Sage we understand how disruptive RTI will be for employers and Accountants alike in particular the processes you all take in ensuring employees are paid on time and accurately.  ....

 

St Crispin is the patron saint of cobblers, isn't he?  What a load of tosh. RTI shouldn't be at all disruptive for end users if the payroll provider gets it right, and how are the processes to pay employees paid on time linked with RTI?

 

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Manual

I do agree that especially for one director companies manual is quicker. I hate the idea that with Money soft you can change period so easily, surly a recipe for disaster. What is more interesting is that if so many of you haven't touched manual payroll for so many years !!! How can you be sure your programme is correct? And if you do have a computer problem and need to produce figures manually you would be stuffed. I think it's always good to understand what goes on behind the programme, something many clients that run their own payrolls don't know and I find it scary that you give someone a programme and they think they know it all.

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moneysoft

Another vote for moneysoft, incredible value for money at only £112 for the multi-company version.  Has definitely not been over-engineered or burdened with extra buttons and functions, I'd be shocked if it was physically possible to manually beat moneysoft. .  ., itHe

http://www.moneysoft.co.uk/payroll-software/payroll-manager.htm 

 

Charles Accoutnancy

www.charlesaccountancy.com

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Small payrolls

We all know that payroll software is far superior to spreadsheets or manual systems, but the OP was asking whether it was quicker and cheaper to do it by hand for small payrolls of say 3 people.

The short answer is No if he means literally by hand, but maybe Yes if he uses a spreadsheet and understands what he's doing (which I'm sure he does if he's been doing payroll so long that he still uses manual methods).

For 3 people a properly set-up spreadsheet would take literally seconds, even quicker than a software package. It's the set-up time that tends to make them more cumbersome (eg changing rates and allowances each year) and the extra work caused by odd tax codes, starters, leavers, changes to marginal tax/NI rates, etc.

RTI is obviously a major factor here as he will have to do a lot of extra manual work submitting the data each month without a software package.

I certainly wouldn't advocate spreadsheets for doing payroll normally, but in answer to the actual question, it may well be viable for just 3 people if there is little additional work as mentioned above.

Chris

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Payroo

I use Payroo, which as mentioned is free for small payrolls (< 10 year end P14s).  The only payrolls I do are small and are generally the same each week or month.  I certainly wouldn't go back to doing it manually, even using a spreadsheet, for all the reasons (complications) mentioned by others.

 

When I first started using Payroo it was a little intimidating - who wants to make a mistake with something as important as someone's wages and using new software?  However, 5 minutes reading the help screens and I was up and running, with a similar situation when I came to run the first year end.  To set up a reliable spreadsheet would have taken many hours of typing and testing, which time could be better spent.

 

Definitely software - and specifically cloud - for me.

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Small Payrolls

I have used the HMRC recommended web based system payroo.com since Mamut withdrew ongoing payroll support to MYOB accounting software. It is exceptionally versatile and it's FREE!

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Small Payrolls

MYOB User wrote:

I have used the HMRC recommended web based system payroo.com since Mamut withdrew ongoing payroll support to MYOB accounting software. It is exceptionally versatile and it's FREE!

Before anyone asks: "Payroo has integrated the HMRC RTI related changes into the existing payroll software to comply with the new regulations and will be available for all employers registered with HMRC RTI Pilot from April 2012. Employers can continue using payroo services the same way without changing anything."   

 

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At sage we understand

"At sage we understand".

Do me a favour. The functionality and perhaps more importantly the ease-of-use of Payroo (Cloud) and Moneysoft (Local) software applications blow Sage's offerings into the dust. And that's before one considers cost. This is the case of the Kings Old Clothes I am afraid.

Captain

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Exactly my thoughts.  Sage is

Exactly my thoughts.  Sage is all singing, all dancing, whereas I just need a bit of karaoke.

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Never mind Sage

In the end we are all going to have to join in the RTI! 

Might think about getting cable broadband in at the office.

OH! not forgetting Universal Credits, that will be fun.

Have a good weekend

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I hope SAGE are a little bit more ready for RTI than for iXBRL....or they will be trying to lobby for the deadline to be put back while they play catch up!

I am a moneysoft user, just renewed today as it happens.

It might look awful and have IT people sniggering behind their sleeves at how old school it it, but its lovely bit of kit, quick and easy to use. Thats what counts, ie how many can my assistant drill out in a day without bothering me? That is the key question.

My assistant was talking to her friend down the road who use SAGE and due to a user error had spend the day issuing complicated corrections to payslips. My assistant on the other hand.........has taken the afternoon off and gone shopping.

 

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Sage

ireallyshouldknowthisbut wrote:

My assistant was talking to her friend down the road who use SAGE and due to a user error had spend the day issuing complicated corrections to payslips. My assistant on the other hand.........has taken the afternoon off and gone shopping.

I know it is fashionable to say you don't like Sage but I don't think there's anything wrong with Sage Payroll. I use it for one employee employers through to a 32 employee employer.

When there was an error recently it was easy to roll back one employee and correct.

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@neilson.watts

Several software & other providers are member of this site and most make valuable & relevant contributions to discussions and questions. 

Your posting however appears to be a blatant advertisement, in fact it looks like you've copied & pasted it out of a piece of marketing literature, rather than respond to the OP's question/opinion. 

Do you have an opinion on manual payroll preparation or on over-engineed software?

 

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Another vote for Moneysoft

All our payrolls are small ones with few changes. Surely RTI is more of a reason to use software than ever?

Moneysoft is currently as easy to use as a spreadsheet that has already been set up for the year with no extra bells and whistles other than filing direct to HMRC. The small annual fee pays for itself in setup time and the monthly processing is fast and efficient. You can print payslips to plain paper or a nice looking PDF to send by email. I was converted instantly after my free trial.

I think it is very brave of @neilson.watts to post a Sage advert on a forum like this. Sage was far too complex for us so I laughed at the "We at Sage understand" bit as they clearly haven't worked in a small practice like ours. Moneysoft cut our average monthly processing time to about 30% and the annual returns are even more efficient. We also save on stationery.

Anyone want a box of Sage payslips? (plus the spare payslips from single director payrolls printed on 2 payslips/page stationery)

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Pre-Printed payslip stationery is so 1990s

HudsonCo

Thanks for you kind offer of the free pre-printed payslip software. I did laugh at that. The idea of paying for (!) and loading special stationery, lining it up, not printing in the boxes, trying again, it's so 1990s. Bet you can't give it away.

Captain

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Well, someone had to do it

I thought I'd try to see how long a sample exercise takes with an over-engineered piece of software. No frantic typing or clicking was involved, but I already knew how to operate the software in question.

So I set up a clean new VM on my PC and downloaded a popular (ahem) piece of free commercial software from the internet and installed it. (50 seconds, you'd have to do this once a year, probably)Fired the commercial software up. (3 seconds).Said I wanted to start a new employer file, and filled in employer name & address PAYE reference, and HMRC login details (1 minute, near enough. You'd only need to do this the first year with a new client). Doing this is useful, because the one-time investment of that minute makes stage 7 happen with a couple of clicks a year.Set up the details of 3 employees, including all relevant information needed for HMRC filing such as NINO and home address and their regular pay (2 minutes 30 seconds, this is only required whenever new employees join and to set up existing employees)Run through a year's payroll processing, including generating an annual set of payslips for each employee in a PDF (45 seconds. This horrific task would have to be repeated every year. )Print P35 PDF for client signature and approval (5 seconds)Filed P35/P14 with HMRC (don't worry, I ticked the "Test" button) (A grand total of 5 clicks that needed 20 seconds, most of which was spent waiting for HMRC to say that the filing was successful)

Total elapsed time, including full set up and filing of year end return, under 6 minutes for a year's processing. Subsequent years would take around two minutes to process for the first employer (including the software update) and 1 minute for each of the rest.

(all timings a bit approximate, because it is hard to watch the timer while typing etc, but you get the picture)

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12pay or Moneysoft

Tom, were you using 12Pay or Moneysoft ? : )

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Which was it then?

Richard_Carey wrote:

Tom, were you using 12Pay or Moneysoft ? : )

 

Oddly enough I'm more familiar with 12Pay so I used that. ;)

I expect that similar timings could be achieved by someone familiar with Moneysoft.

 

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There is nothing wrong with it but

Peter

There is nothing wrong with it in the sense that it calculates Net pay from Gross pay correctly. But what is wrong with it, apart from the cost, is its 1990s useabilty.

If you haven't tried some of the locally installed and cloud based systems being talked about in this thread it might be worth an hour of your time. You might be surprised.

And now that payroll year end is almost upon us, good luck to us all!

Captain

 

 

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Sage

I find I can do what I need to do very quickly and I can't see how saving a few seconds off a payroll would even be possible never mind worth the effort of change.

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Each to his own

Perhaps consider changing when the next renewal invoice comes in.

Captain

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accountants being what they are you are probably not

but in Moneysoft its all there for the year , easy filing for p45 etc as well as p11d and p35s also there are very few simple payrolls now - its still quicker easier and more efficient using a good program than a spreadsheet even if the deemed cost is nil - you still need to make a number of adjustmenst evry year for nic and paye etc - but if you happy thats the main thing

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