Payroll Software – A Key Component of Human Resource Management System (HRMS)

October, 2019

Payroll software is a tool used by an organization to organize, manage, and automate the process of employee salaries. Payment software, by tracking all the payments, helps large organizations as well as SMEs to monitor every single employees’ pay structure and tax information.

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Benefits of Effective Payroll Software

  1. Reduced Overheads: By eliminating the payroll outsourcing needs, companies can do it in-house, resulting in saving money and more control over their finances.
  2. Enhanced Employee’s Morale: An effective payroll software ensures that all errors and glitches during the salary time are taken care of, as employees, if not paid on time, feel instability in their job. Hence to keep the employee morale high, effective payroll software is needed.
  3. Reduced Chances of Paying Fines: Organizations may need to pay legal fines for mismanaged records or for not managing their employees’ records. Payroll software, by recording all the deductions in terms of taxes and TDS from an employee salary, saves the organization from paying fines.
  4. Helping Startups: Managing payroll becomes a challenging task for a new start-up owner. Establishing an effective payroll software can help start-up owners in managing company finances and reducing the risk of manual errors.

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Payroll Software can be Deployed in Two Ways

On-premise: Although the on-premise deployment mode is traditional and considered as legacy, many vendors still prefer this deployment mode to keep their employee data safe.

On-cloud: On-cloud deployment is a more user-friendly approach that offers 24/7 support to customers. On-cloud payroll software reduces the burden of managing the software and makes the payroll process more accurate and compliant.


Managing the business and employees is an essential aspect for almost all organizations. Payroll software, by handling all the payment-related adjustments, allows companies to enhance their business operations. Payroll software, by maintaining all the payment records, helps the companies to keep their business running.

– Sonam Chawla
ICT – Research Analyst
Infoholic Research