challenges of payroll processing in singapore

Payroll Processing in Singapore: Challenges in Payroll

Payroll processing appears to be very straightforward – consolidate work hours, calculate wages owed, and send out pay slips. Yet, when it actually comes to processing payroll, there always seems to be challenges to overcome.

7 Challenges in Payroll Processing

Compliance with local laws and regulations

Companies need to comply with various laws and regulations, such as Employment Act, CPF (Central Provident Fund) Act, and Income Tax Act, among others. These laws and regulations in Singapore can change periodically, making it challenging for companies to keep abreast. Thus, ensuring complete compliance with local laws and other legislation can be a challenge for many organisations.

Calculating and remitting taxes

Payroll processing involves the calculation and remittance of taxes, such as income tax and CPF contributions for each and every employee. The process is repetitive, but it can be complex and time-consuming when done manually. The software can calculate and remit taxes accurately and on time, reducing the risk of errors and fines.

Managing employee information

Companies need to ensure that all employee information is accurate and up-to-date. These information include personal, payroll, and tax information. While most organisations are storing these information digitally, not all information are properly migrated into systems. Some organisations, for example, may still be manually keying important employee data into Excel spreadsheets, making it hard to track and prone to human error. A decent payroll software can store and manage employee information, making it easier to update and access when needed.

Integrating with existing systems

More often than not, companies utilise multiple systems for different functions. Thus, there is a need to integrate payroll processing with other systems, such as attendance tracking or benefits management. Regardless of the systems, such integrations are always complicating and time-consuming.

Ensuring data privacy and security

Keeping employee payroll information confidential and secure is critical. Failure to do so can result in huge losses for the organisation. In December 2022, a server containing Keppel Telecommunications and Transportation employees’ personal data was hacked. While there were no impact on operations, measures were taken to ensure that the affected parties were aware of the situation. It is important for companies to implement appropriate measures to protect this sensitive information.

Timeliness and accuracy

It is important for companies to ensure that payroll processing is accurate, timely, and efficient to avoid errors, delays, or even potential employee dissatisfaction and legal consequences. In order to achieve timeliness in payroll processing, these tasks must be done quickly and accurately. With a manual system, it is no surprise to be faced with human errors and administration delays. By automating manual tasks in payroll processing, it is possible to significantly reduce the risk of errors and delays to ensure timely and accurate payroll processing.

Managing multiple payrolls

Companies that operate from multiple locations or have employees in different countries may need to manage multiple payrolls. This makes payroll processing more complexed and challenging to coordinate. A software can manage multiple payrolls from a single platform, simplifying the process and reducing the administrative burden.

A payroll processing software such as Jusixty can significantly simplify and streamline the payroll process by automating many of the manual tasks involved. Sign up for a free trial (U.P: SGD 7/month/employee) and get started right away.