What Is Managed Payroll?

Managed payroll services are provided by third-party providers who will handle all aspects of your payroll activities. 

Efficiently managing payroll is crucial for your business, ensuring your employees are paid accurately and on time while maintaining compliance with regulations and optimizing financial resources. 

In this guide, Aniday will help you understand managed payroll in-depth, how it works, and the benefits it would bring you if you integrate it into your company.

What Is Managed Payroll?

Managed payroll is a service that handles every aspect of payroll processing and tax compliance activities. A third-party organization that provides managed payroll services is called a Managed Services Provider (MSP) or Payroll outsourcing company.

Just like EOR (Employer Of Record), your MSP will handle payroll processing and tax compliance activities on your company's behalf. Here's a list of activities carried out by your MSP:

• Set up and manage the payroll system.
• Collect and enter the necessary employee data.
• Calculate gross salaries, handle withholdings, handle benefits, provide employee payslips, employee tax filings, and make deposits for employees.
• Ensure your company meets compliance with tax, payroll laws and regulations.
• Complete government remittance activities.
• Complete all the necessary paperwork related to payroll activities.

How Does Managed Payroll Work?

Depending on your managed payroll service provider, pricing structure, and expertise, the way they work differs. However, here's a quick walkthrough of how the managed payroll companies generally work:

• Setup and integration of your business to the payroll system: Initially, your company information is integrated with the provider's payroll system or software. For example, employee data, the number of hours they work, benefits, salaries, benefits, and tax information are added.
• Payroll processing at pay periods: During every pay period, the business must provide updated information on employees' working hours, salaries, bonuses, and other details to the payroll provider as per the requirement. Then, the provider calculates the gross wages for each employee.
• Tax filing and compliance: During the tax filing process, the managed payroll provider handles all aspects of tax compliance and the necessary paperwork.
• Payment distribution to employees: After the payroll calculations and procedures are complete, the MSP deposits the payments to the employees through direct deposits or cheques.
• Record keeping: The service provider will maintain payroll-related records and information about these activities. Ideal reports will also be provided so your business can keep track of the work.
• Ongoing support: While the service providers manage your payroll-related activities, they will be available for ongoing support to answer all your payroll-related queries.

Benefits Of Managed Payroll

Managed payroll systems help you handle your payroll-related activities effectively by providing a handful of benefits. Here are the benefits of having a managed payroll provider:

• Control costs: Using managed payroll services helps to reduce costs related to internal payroll teams or departments, payroll software subscriptions, office equipment, supplies, and infrastructure.
• Effective compliance risk management: If you have a team to handle payroll-related legislation, it would be complex. Also, you need to make sure they have sufficient knowledge and skills. However, outsourcing to a managed payroll provider helps to ensure that you are saved from all the risks of compliance management with experts on board.
• Ensure accuracy: When you hire a payroll-managed service, they have the ideal expertise and ensure accuracy in the work performed. Hence, you will not face any hassle related to the government, contractors, employees, or non-permanent workers. Moreover, all the payments will be made accurately and on time.
• Ensure security: It is essential to ensure the payroll information is secure as it contains the confidential information of the employees and business. Thus, managed payroll services rescue you from all security issues, including fraud, unauthorized access, data breaches, and adhere to the laws.
• Save your time: Managing a payroll system is complex. Hence, MSP helps you focus on your work strategies and avoid complex tasks while handling your payroll system without any hassle.

You can experiencing these benefits by partnering with us - Aniday. Outsource your payroll-related task to Aniday to reduce costs, ensure expert compliance, and safeguard sensitive data, all while freeing up your time for strategic goals.

Final Thoughts

In conclusion, managed payroll providers help enhance your company's overall efficiency and effectiveness. Instead of having an in-house team, outsourcing will allow you to focus on and develop your business, leaving all the payroll-related activities behind.

If you are looking to expand your business presence in Vietnam, Singapore, or Indonesia or hire employees there, Aniday’s EOR service ensures that meets compliance with all applicable employment regulations and ensures your staff receives all the employee benefits they are entitled to. 

Contact Aniday today to find out more!

We hope this guide was helpful for you to understand about managed payroll systems!