Cloud payroll software: The options
Payroll has been a big topic for our members recently, not least with the advent of auto enrolment and its various staging dates.
The entry of cloud accounting software developer Xero into the UK market added an extra touch of spice to the payroll scene, and claimed to be the first cloud developer to link payroll with accounts and a business intelligence dashboard.
Based on the Any Answers questions that arose about what options there are for cloud payroll, we decided to take a closer look at providers - both those that integrate with accounts and standalone payroll applications.
FreeAgent's payroll engine has been a key component of the accounting package for some time. Users can run a monthly payroll for themselves and/or their employees, and file it to HMRC under RTI rules.
Accountants can do this for their clients in FreeAgent and set varying degrees of access to the program, so that the client can see the payroll figures, but not file them. If the accountant is using another software package to run payroll, then the payroll can be run in FreeAgent but not submitted to HMRC. Or, the accountant can upload payroll data from another package into FreeAgent, so that the accounts are updated to show wages and PAYE/NI due.
Pricing: As an integrated component, there is no extra charge for FreeAgent’s payroll module, irrespective of the number of employees each client has.
Auto enrolment: One person limited companies form the bulk of FreeAgent's customers. These companies are exempted from AE, so the software doesn't currently support auto enrolment. However, the company is in "active discussion" with third parties to discuss whether it could easily export data from FreeAgent into their software.
Sage One is primarily designed for micro and small businesses. The payroll program runs alongside Sage One accounts and can handle both RTI and auto enrolment.
To set up payroll in Sage One, users decide how often they want to pay employees and then upload straightforward employee information. The software is designed around a four-step process to assess the workforce for automatic enrolment, pay them, print payslips and submit RTI returns. In addition to PAYE, NIC, sick and maternity pay, student loans and earnings order calculations the software includes standard payment templates that can be customised to account for additional items such as overtime.
When it sends the RTI full payment submission (FPS) to HMRC, Sage One Payroll updates the salary journals in Sage One Accounts. It comes with free UK -based support including 24/7 telephone, email and web chat and a support hub.
Pricing: Sage One Payroll costs £5 per month for 5 employees, £10 for 10 employees and £15 for 15 employees. There is also a choice as to whether to subscribe to Payroll, Accounts or both products.
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Auto enrolment: Sage One Payroll includes all AE functionality at no extra cost to users’ monthly payroll subscriptions. The AE capabilities include:
- Staging date countdown to when your business needs to be ready
- Four-step automatic enrolment preparation wizard
- Ongoing worker assessment
- Opt-in, opt-out and worker postponement tools
- Create secure auto enrolment communications to your workers via printed or emailed letters
- Track what you owe the pension provider
- Record keeping and communications audit trail.
KashFlow is now part of the IRIS tax and accountancy combine that is responsible for heavyweight payroll applications like Earnie. After KashFlow became the core of the group's cloud wing, the application formerly known as IRIS OpenPayroll was transformed into KashFlow Payroll. The program is HMRC-recognised for RTI. It creates automatic FPSs throughout the year, and has an online payslips facility and a company dashboard for monitoring payroll progress and statistics. The subscription includes unlimited employees and companies along with customer support.
Pricing: The system starts at £5 per month for 1-5 employees, with an additional £1 per employee per month for any additional employees, and £0.25p per employee for ESS (e-payslips).
There is also a separate pricing tariff for accountants, which KashFlow describes as a competitive pricing structure in which the price per employee decreases according to the number of employees processed in the bureau.
Auto enrolment: KashFlow’s payroll program includes an AE setup wizard, employee assessment and auto enrolment reports. The existing AE functionality is being developed further to include communications to employees along with output files needed by the pension provider.
4. Xero Payroll
While still at an early stage in its lifecycle, Xero’s UK payroll tool is RTI-compliant from the outset and integrates with Xero accounting. RTI submissions are automatically made upon posting a pay run, and that information flows from payroll into the accounts.
Users can view the status and history of RTI submissions made on an RTI Filings dashboard. In addition, users can easily access a P32.
Whether payroll is managed by the employer or an external agent, employees can be invited to a secure portal where they can view their own pay history, payslips, holidays taken and requests for time off without being able to see the rest of the Xero accounts. This will be available via the web on release, along with iOS and Android phones shortly afterwards.
Pricing: Pricing for payroll is bundled into the main Xero subscription, which started at an introductory rate of £20/month for one employee. The premium subscription for 10 employees is £25 per month, rising to £80 for 100 employees.
Auto enrolment: At the time of launch in Feburary 2015 included basic AE data fields that give users the ability to enter details of their pension scheme provider and contribution arrangements. Further features to come will include output files for the pension providers, detailed reporting and assessment of employees.
This standalone cloud payroll applications integrates with the likes of Xero, KashFlow and Twinfield and includes includes a payroll dashboard to keep track of each scheme. Accountants and bureaux that join the MyPAYE partner programme can run the application from their own website, with logos and colour branding to match. The programme offers discounted rates, monthly billing with breakdown by client, branded payslips and CIS construction industry scheme for subcontractors functionality.
Pricing: £1 per month per paid employee and a 30-day free trial. There is no licencing limit on the number of companies or employees and users only pay for those employees you produce a payslip for.
Auto enrolment: The software includes AE functionality including employee assessment, export of Pension AE data to Pension Provider for supported file formats.
With a free option for the smallest companies, Payroo is gaining a growing following among AccountingWEB members. The developer claims its cloud program is compatible with any accounting package and can generate P45s and payslips as well as all statutory returns and notices. Each employee can sign into an individual account. Its other features include reports, RTI eReturns, automatic P11S reports and pay summaries.
Pricing: Payroo is free in companies with fewer than 10 employees, but can cater for up to 5,000 employees for a fee of £3 per employee per year, payable at the end of the tax year.
Auto enrolment: Able has implemented the comprehensive AE into the existing payroll system adhering closely with The Pensions Regulator and will be available for all employers to auto enroll their employees who meet suitable/qualifying criteria into a workplace pension scheme.
The Clear Books payroll module supports different pay periods, bulk processing, RTI FPS and EPS formats, payslips output in a variety of formats, ane the ability to export CSV files to Natwest and RBS. Accountants using the program can also enter agent information to access and interrogate HMRC Online from within the application. Its full features are available on the official website.
Pricing: Pricing starts from £6 per month (including VAT) for two employees. Three or more employees will be charged at £2.50 each per month.
Auto enrolment: Clear Books is gearing up to support automatic enrolment support in its 2015-16 tax year release. The software will tell employers that employees need to be auto enrolled as their pay/age dictates, and will stop pensions being provided to employees who are below the minimum permissible amounts. The payroll module will not generate AE letters and communications, but Clear Books is working on tools to help customers remember their key filing dates and to direct them to guidance from The Pension Regulator and their pension provider.
Designed for larger organisations, CloudPay claims to be the world’s only cloud-based global platform for integrated payroll and payments processing. The program is a multi-currency, multi-lingual cloud system that can house multiple companies within a secure, multi-tenant environment. It integrates with existing enterprise resource planning (ERP) and human capital management (HCM) and includes various features such as employee self service access to payroll information.
Pricing: CloudPay's pricing model is based on a per payslip per month license fee that ensures the ongoing cost model is always relative to the size of the business. The model is based on:
- Managed service fee per month & total annual managed service fee
- Subscription fee per employee per month
- One time implementation fee
- One time in-country setup fee
- Payroll processing fee per employee per month.
Auto enrolment: As part of its commitment to comply with all statutory requirements in each locale, CloudPay’s can cope with the UK’s auto enrolment regime.
From the smallest one-person band to global multinationals, there are cloud payroll options for all comers. While we have provided prices and descriptions of key features including auto enrolment, the ultimate test of any software application is how it works in real life.
Details: With this product, you can run payroll from within QuickBooks Online, check employee payslips as you do the payroll, calculate PAYE and submit RTI data, have your payroll figures flow into your accounts, unlimited support and the ability to record one-off payments.
Pricing: There are various plans, starting from £7.20 per month for 12 months. This price includes the QuickBooks online product - payroll is free.
Auto enrolment: QuickBooks 2014 R5 has AE functionality, such as:
- Recording staging dates
- Assess workforce
- Employees will be assessed at the point of running the payroll
- The system will flag any employee which has changed status
- A new Pension tab on the employee record which includes employee status and enrolment history
- The ability to postpone where necessary
- Updated reports to show pension contributions; both employee and employers
10. Liberty Accounts
Details: Liberty Accounts has included an HMRC recognised payroll suite as part of its online accounting solution since 2004. Access to the payroll can be restricted using roles, allowing accountants to give clients access to their payroll, or manage it on their behalf as required.
The payroll is RTI compliant and weekly/fortnightly/four-weekly/monthly pay periods are all supported. Additionally, the payroll workflow pulls expense and mileage claims from the accounts into the payroll.
The payroll suite also includes a fully integrated P11D feature for tracking of benefits and expenses and submission of P11D’s and production of Section 336 claim forms.
Pricing: Under their small business concessionary rate, £12.95/month, payroll and P11D are provided free of charge. For businesses exceeding the small business thresholds payroll/P11D is £1/employee.
Auto enrolment: Within Liberty Accounts pension deductions can be set to auto enrolment thresholds. The package will provide the required data extracts for the leading pension providers.
While not a cloud payroll provider just yet, Brightpay is planning to allow the user to have the option of storing their payroll data in the cloud.
They have stressed that this will be an optional feature.
Keytime does not yet have a full cloud payroll product, but it will be launching a new Payroll Payslip Portal product in April 2015, powered by Arithmo.
More information will be featured in a later wider article on auto enrolment compliant software.
13. Nomisma Solution
This is a new to the market product that encompasses accounts production and payroll. It officially launched at Accountex last year.
Pricing is as yet unknown but its functions include:
- Set up unlimited companies
- Bulk RTI submissions saving you significant time in submitting payroll
- Send pay slips to all clients at a click of Button
- Payroll Reports
- Auto payroll
- Fully integrated to accounts
If you have experience using these products, please comment below and tell us what you like or don't like about them. Similarly if we have missed a product out, let us know and we will add it to our round-up.