The foundation of paying your team
Payroll is more than just paying salaries. It encompasses everything involved in compensating employees for their work, from calculating wages and deductions to ensuring compliance with contribution requirements. For any business with employees, getting payroll right is essential.
What Payroll Includes
Payroll covers the complete process of compensating employees:
- Salary Calculation including base pay, overtime, and allowances.
- Deductions for statutory contributions, insurance, loans, and other withholdings.
- Disbursement of net pay to employees via bank transfer or cash.
- Record Keeping for payslips, payment history, and audit trails.
- Compliance with government requirements for contributions and reporting.
Why Payroll Matters
Accurate and timely payroll is critical for several reasons:
- Employee Trust is built when salaries arrive on time and calculations are correct.
- Legal Compliance ensures your business meets statutory obligations.
- Financial Planning depends on understanding your payroll costs and obligations.
- Record Keeping provides documentation for audits, disputes, and business decisions.
Components of Employee Pay
A typical payslip breaks down into several components:
- Basic Salary is the fixed amount agreed upon in the employment contract.
- Allowances are additional payments like transport, phone, or meal stipends.
- Gross Pay is the total of basic salary plus all allowances.
- Deductions include employee contributions, insurance, and other withholdings.
- Net Pay is what the employee actually receives after all deductions.
Employer Responsibilities
Beyond paying employees, employers typically have additional payroll responsibilities:
- Statutory Contributions such as pension, social security, or provident fund payments.
- Levies that may apply to certain employees or industries.
- Tax Reporting to relevant authorities as required by local regulations.
Manual vs Automated Payroll
Businesses can manage payroll manually using spreadsheets or automate the process with software like Officaid:
- Manual Payroll requires calculating each component, looking up contribution rates, and generating payslips individually. This is time-consuming and prone to errors.
- Automated Payroll pulls employee data, calculates contributions automatically, generates payslips in bulk, and integrates with government submission systems.
Frequently Asked Questions
Payroll frequency depends on your business and local requirements. Monthly payroll is common in many regions, while others use weekly or bi-weekly cycles.
Bulk payroll processing in the Payroll module runs on a monthly basis. If you need to add payslips for different pay periods (such as bi-weekly or weekly cycles), you can add them directly from the employee's profile. Go to Team → Directory, select the employee, and use the Payslips section to create payslips for specific periods. See Adding a Payslip for details.
Officaid currently supports Singapore statutory contributions including CPF, SDL, and SHG, with automatic rate calculations based on employee details.
What's Next?
Learn more about payroll fundamentals:
- What is Payroll Processing explains the step-by-step process of running payroll.
- Navigating the Payroll Module shows how Officaid organizes payroll tasks.
- What is CPF covers Singapore's mandatory contribution system.