Single Touch Payroll Reporting: The Key Points For Australian SMEs 

Single touch payroll reporting

It’s been six months since the hard deadline for businesses with nineteen or fewer employees to switch to single touch payroll reporting. Since then, more than 462,000 firms have signed up for STP-enabled software

However, adopting a new process can be a little tricky, and with the end to the financial year fast approaching, businesses need to make sure they’re in line with the Australian Tax Office (ATO) requirements. In this article, we break down the key points that small businesses need to know about for single touch payroll reporting, as well as how to provide information to the ATO.

Single touch payroll reporting

What is Single Touch Payroll reporting?

Single Touch Payroll (STP) is the new, official way for Australian employers to report information about tax to the ATO. As of July 2019, small businesses must use STP compliant software to lodge their employee’s salary, wage tax and superannuation information, as well as pay as you go (PAYG) withholding. 

Do micro employers need to use STP-enabled software?

Micro employers need to use STP-enabled software to lodge tax reports. Even if the business has less than four members of staff employed, it is still a requirement to follow the ATO’s new process. 

There are plenty of low-cost or no-cost payroll solutions available for businesses of this size that include the basic requirements for tax reporting. 

When should small businesses be STP ready?

Employers with 5-19 employees should start reporting through STP-enabled payroll software immediately. ATO released a reporting checklist to help businesses adapt to the new process. In the case that a business needs extra time to fully-transition over, they can use the online form to apply for a deferral

If a business operates in an area with intermittent or no internet connection, they (or their agent) can apply for an exemption

What are the main changes?

The main change for small business tax reporting is that employers must now submit this information during the payroll process. Businesses must also lodge the information digitally using STP-enabled software. 

Previously, businesses reported this information once a year, and many employers would lodge their information via paper or manual submission.

Here are a few other noteworthy changes:

  • Employers aren’t required to give their staff a payment summary or income statement for the information reported through STP. They must, however, provide employees with information that isn’t reported through STP.
  • Employees who no longer receive a payment summary or income statement can find the information needed to complete their tax return via through myGov via ATO Online
  • Businesses don’t need to submit a payment summary annual report (PSAR) anymore for the information reported through STP.

What are the main benefits of moving to STP?

Payroll reporting STP

Employers will benefit from Single Touch Payroll reporting in several ways:

1. Less room-for-error

The ATO pre-fills several fields in the reporting forms. It pre-fills PAYG withholding payroll fields W1 and Q2 in the BAS, making it easier and quicker to complete.

2. Fewer steps in the process

Employers are no longer required to provide payment summaries to staff members because the information is available to them on the myGov website. Real-time information, such as year-to-date payments and contributions made to the ATO, is instantly accessible and employees don’t need to wait for a payment summary.

3. Quicker onboarding of new staff

Instead of manually filling out paper forms, employers can onboard new starters through an online commencement form, including Tax File Number Declaration and SuperChoice.

4. Time-saving

The new process is much more manageable because it coincides with payroll. Instead of submitting a sizable report once a year in July, employers submit reports during every pay run. This enables them to gain back valuable time around the end of the financial year.

What are SMEs required to report?

According to the Government of Western Australia, single touch payroll requirements include monthly (or quarterly) business activities and instalment activity statements. It also includes financial year-end reporting.

Below, we cover the need-to-knows for each type of report:

Business activity statement (BAS) 

The business activity statement (BAS) provides critical tax information and enables businesses to pay:

  • Goods and services tax (GST)
  • Pay as you go (PAYG) instalments
  • PAYG withholding tax
  • Any other relevant tax obligations.

The ATO automatically sends businesses a BAS when it’s time for them to lodge, as long as they’re registered with an Australian business number (ABN) and GST. All businesses registered for GST must submit a BAS before the due date.

Instalment activity statement (IAS) 

The IAS report is similar to the BAS report. The difference is that it is without GST and some other taxes. If a business isn’t registered for GST, they’ll submit an IAS to pay PAYG instalments.

Financial year-end

The financial year reporting for tax purposes runs from 1st July to 30th June. Businesses must lodge an income tax return to cover this period. Sole traders can declare their business income as part of their personal income tax return.

Common mistakes to watch out for

STP tax errors

James O’Halloran, the deputy commissioner of ATO, revealed in a recent speech he made at PwC’s payroll managers forum that the majority of small companies (82%) correctly lodge STP reports on time. 

However, some common errors have emerged since the hard-deadline for STP adoption. This includes:

  • Incorrect electronic fund transfer codes (these enable BPAY).
  • Multiple identification numbers being provided. 
  • Late tax reports. 

Ultimately, ATO is unable to accept these records. However, O’Halloran said the ATO is looking to offer extra support to SME during their transition over to the new process:

“We’re working through the data and gaining insights that help us identify when employers are falling behind with their PAYG withholding or SG obligations. We’re also using the insights and learnings from health checks to support a range of stakeholders who report through STP. We do this by working directly with software and solution providers to validate the information being received.” 

 

Looking for an STP solution to report payroll? Check out Capterra’s directory of payroll software and accounting software platforms today. 

Mejora la planificación de tu negocio: 5 herramientas para hacer presupuestos y previsiones

Apps para hacer presupuestos y previsiones

Apps para hacer presupuestos y previsionesLlevar al día las finanzas y tener previsión de ellas es importante para cualquier negocio. No obstante, para las pequeñas empresas este requisito lo es aún más. Esto se explica porque el flujo de caja suele cobrar más importancia en las pymes, sobre todo cuando se retrasan los pagos de los clientes. 

Las herramientas para hacer presupuestos y previsiones permiten a tus empleados introducir los gastos e ingresos previstos, datos que son procesados para producir informes, gráficas, simulaciones y muchas más opciones para que puedas tener una visión del presente y posibles escenarios futuros de tu negocio, y por ende desarrollar soluciones.

Contar con una transparencia completa de los gastos y una buena comprensión de los recursos financieros es fundamental para poder planificar el futuro y evitar imprevistos en las facturas.

Por estos motivos la automatización del software está dando tantos beneficios a las pequeñas empresas. Además, las herramientas de presupuestos empresariales recopilan estos datos y puede hacer una previsión de las tendencias de crecimiento y de la rentabilidad, lo que te da una idea bastante clara de dónde estará tu negocio en los próximos meses. 

Algunas herramientas incluso pueden realizar simulaciones y presentar posibles soluciones a los escenarios en los que te puedas encontrar. 

Si aún no has puesto implementado un programa para hacer presupuestos, el 2020 debería ser el año para dar el salto.

Para ayudarte a comprender qué opciones tienes a tu disposición, hemos recopilado esta lista de cinco herramientas para hacer presupuestos y previsiones más destacadas.

La lista ha sido elaborada bajo la siguiente metodología:

  • Valoradas con más de 4 estrellas por los usuarios en capterra.es
  • Más de 100 reseñas en capterra.es
  • Alto volumen de búsqueda en España

Board

Valoración: 4.5/5

Fácil de usar: 4.3/5

Servicio de atención al cliente: 4.5/5

Funcionalidades: 4.5/5

Prueba gratis: Sí (previa solicitud)

Board
Fuente: Board

Una plataforma multiusuario y flexible. Permite que distintas personas estén trabajando a la vez en un mismo proyecto. Tiene la capacidad de concentrar diversos tipos de datos brutos del negocio, aunque provengan de diferentes fuentes, y procesarlos. Con esta información se puede hacer simulaciones, análisis, previsiones, presupuestos, entre muchas otras opciones. Todo en un sencillo entorno de arrastrar y soltar de analítica de autoservicio. Aparte es escalable, en caso de que el negocio crezca rápidamente.

Algunos usuarios indican que la curva de aprendizaje es lenta. Pero existe el Board community, un foro en el cual los usuarios de Board se comunican entre ellos, resuelven dudas, se dan consejos, un espacio muy útil a la hora de utilizar y conocer esta herramienta.

Dynamics 365

Valoración: 4.3/5

Fácil de usar: 4/5

Servicio de atención al cliente: 4.1/5

Funcionalidades: 4.2/5

Prueba gratis: No

Dynamics 365 app
Fuente: Microsoft Dynamics 365

La solución de gestión empresarial integrada de Microsoft ofrece capacidades de automatización y de inteligencia en los procesos financieros, de relación con los clientes y de la cadena de suministro. El software permite a los usuarios supervisar el rendimiento en tiempo real, predecir resultados futuros y tomar decisiones basadas en los datos.

Los usuarios aprecian la plataforma por su buena gama de herramientas listas para usar y su precio. El diseño y la interfaz del software también son dignos de alabanza. Algunos usuarios informaron sobre experiencias negativas con la asistencia y sobre fallos derivados de las actualizaciones.

Adaptive Insights

Valoración: 4.5/5

Fácil de usar: 4.2/5

Servicio de atención al cliente: 4.4/5

Funcionalidades: 4.4/5

Prueba gratis: Sí

Adaptive Insights app para presupuestos y previsiones
Fuente: Adaptive Insights en Capterra

Adaptive Insights es un conjunto completo de software de planificación empresarial que incluye planificación, modelado, creación de presupuestos y previsión. En lo que se refiere a la elaboración de presupuestos, el software ofrece herramientas de planificación financiera, creación de informes y análisis para que las empresas puedan presupuestar de forma precisa y rápida.

Los usuarios afirman que el software hace que la previsión se convierta en un proceso simple y destacan la adaptabilidad del sistema. Otros usuarios admiran su capacidad de integración con SAP y Oracle, así como los niveles globales de asistencia al cliente. Sin embargo, los usuarios también comentan que la curva de aprendizaje es pronunciada y que el producto puede tardar un tiempo en superarla.

Sage Intacct

Valoración: 4.2/5

Fácil de usar: 4.1/5

Servicio de atención al cliente: 4/5

Funcionalidades: 4.1/5

Prueba gratis: Sí

Fuente: Sage Intact en Capterra

Sage Intacct, un completo software de contabilidad y gestión financiera, ofrece servicios financieros básicos y avanzados. Sus aplicaciones de presupuestación y planificación se basan en la nube y ofrecen la posibilidad de efectuar análisis y previsiones. El software permite una colaboración sencilla y el control de versiones en todas las unidades de negocio.

Los usuarios afirman que el software es muy flexible y rico en funciones, con una especial mención a su capacidad de generar informes.

Cognos

 Valoración: 4.1/5

Fácil de usar: 3.8/5

Servicio de atención al cliente: 3.7/5

Funcionalidades: 4.1/5

Prueba gratis: No

Cognos app para hacer presupuesto y previsiones
Fuente: Cognos Analytics

Una solución de BI (inteligencia de negocios) y Gestión de Rendimiento de autoservicio que permite hacer presupuestos, planeaciones estratégicas, previsiones y consolidaciones a través de distintos departamentos. Tiene la capacidad de recibir distintos tipos de datos y explorarlos con visualizaciones inteligentes, cada una dependiendo la información de que se trate. Presenta una versión completa para móviles, la cual es muy útil ya que se puede acceder a la herramienta desde diferentes dispositivos desde cualquier ubicación.

Los usuarios describen que los informes pueden personalizarse y producir reportes interactivos muy detallados. También mencionan que el precio no es económico pero que vale la pena adquirir el software.

Echa un vistazo a nuestro directorio de programas para hacer presupuestos ahora y encuentra el mejor software para tu negocio.

Small businesses in the UK keen to adopt digital banking

small business banking and traditional versus traditional banking

Since 2008, following the financial crisis and with the booming of technology, the banking industry has witnessed changes that have meant the entry of new players. Small business banking has also changed since. Until then, traditional banks were the go-to option for all businesses, whether big or small. Trust in banks has decreased since the financial crisis in 2008 and it was this opportunity that the new banks seized to enter the financial market. 

small business banking

Did you know? Traditional banks are those offering physical branches and online whilst digital banks are only available online.

The British Bankers’ Association asked regulators to lower the entry requirements for challengers banks to increase competition in the banking industry, led until then by traditional banks (also called the ‘big four’). 

Did you know? The phrase ‘big four’ refers to the four largest banking groups. In the UK, these are Barclays, HSBC, Lloyds Banking Group and The Royal Bank of Scotland Group.

The birth of digital banks

Following this, a number of new digital banks appeared between 2014 and 2015: Starling Bank, Monzo, and Revolut among others, looked to ‘challenge’ the traditional banking industry. These new banks offered a new way of banking, more agile and all online. These banks offer more flexibility when looking at operations, allowing customers to do day-to-day operations online without the need to go to a physical branch.

Digital banks have made a big impact on the UK financial sector. In the Bank of England’s 2018 report ‘Embracing the promise of fintech’, 74% of UK adults use online banking and the number of visits to bank branches has decreased by 26% from 2012 to 2017.

We wanted to take a closer look and understand how small businesses choose to work with a bank for their primary business account and how this may differ from their private banking choice.

We surveyed more than 600 respondents for this article. Out of these, 72% were self-employed and freelancers, 24% an SME owner and 4% an in-house accountant. 74% of respondents have 1-10 employees.

Highlights of the study:

  • 57% use a mobile app to access their primary business account
  • 82% of businesses think is important for a bank to have a physical branch
  • 90% would consider switching to a digital bank
  • 77% use a traditional bank for primary business

The presence of a bank branch is still important 

When we asked respondents about their view on the importance of having a physical bank branch that they can go to, 82% said that it’s important to have a physical bank branch to go to.

A third of respondents stated that when looking for financial advice they prefer to visit a branch. In addition, 24% would prefer to have a face to face interaction when looking for business loans and 19% when looking to open a new business account.

Trust is the most important factor when deciding on a bank

68% of respondents said they would choose a bank they trust over one they don’t have much information on. If you think about it, trust is key when deciding where to put your money and, as a small business, it can be vital. Trust can be gained if they have been with a bank for many years, or if they have a personal account and are already familiar with the business offering of the bank.

Despite our research showing that online reviews are more trusted than experts review, surprisingly, online reviews (10%) and recommendations (21%) were not strong factors for respondents. We found that online reviews are trusted more than expert reviews by users when looking to buy a product. 62% of respondents stated trusting more an online review than an expert or a friend’s opinion.

This seems to be different when deciding on a bank. The reason could be that the financial industry is tougher when it comes to building trust, and for digital banks especially as they have only been in the industry for a few years.

These banks are offering lower interest rates and more flexibility in operations (for example is not necessary to go to a physical branch). However, when it comes to building the trust of small and medium businesses, consumers choose traditional banks.

Despite low adoption, small businesses are willing to adopt digital banking

When asked about what bank they use, 23% of respondents use digital banks. However, respondents praise some of their features such as ease of use (34%), flexibility (27%) or cost (15%). 

90% are willing to change to a digital bank in the future. Respondents said that some of them had started with a digital bank as a personal user and decided to move to a business one. Accessibility is another key factor for digital banks to win customers. 57% of respondents access their business accounts via mobile app.

It’s important to note that banking, like many other industries that do trading with the EU may be affected by Brexit. Most banks have been applying for licenses for the last few years to open an office in Europe and continue to provide service to those customers that have international operations.

infographic small business banking digital versus traditional banking in the uk

Interested in learning more? Take a look at our Online Banking Software and Banking Software listings to see how Capterra can help.

Methodology

To collect the data for this report, we conducted an online survey. The answers come from a sample of the target market UK.  Over 600 participants qualified to participate in the survey through screening questions out in January and February 2020. Qualified participants are employed (full-time, part-time or self-employed) and work in a small to medium-sized enterprise (1-250 employees). Respondents were SME owners, self-employed and in-house accountants and either directly responsible for the finance or related to it in a way in their daily activity of the company.

 

L’audit financier, un examen incontournable pour les PME

qu'est-ce qu'un audit financier

qu'est-ce qu'un audit financier

L’audit financier peut sembler être un processus mystérieux, fastidieux et complexe, synonyme de nombreuses démarches administratives. Peu de personnes le maîtrisent alors qu’il s’avère très utile pour les entreprises et les startups.

Les outils d’audit et de reporting financier sont déjà bien implémentés dans votre entreprise ? Au-delà de l’examen de vos procédures, l’audit financier peut être une véritable ressource pour les dirigeants d’entreprises désireux de s’améliorer, de prendre des décisions éclairées et ainsi d’assurer l’avenir de leur activité.

Cet article a pour but de démystifier l’audit financier. Dans les paragraphes qui suivent, nous tâcherons de répondre à toutes les questions que les dirigeants de PME se posent couramment : en quoi consiste un audit financier ? À quoi sert-il ? Tout le monde est-il apte à le réaliser ? Et enfin, quelles sont les bonnes raisons de passer par ce processus ?

Qu’est-ce qu’un audit financier ?

Définition de l’audit financier

 Un audit financier ou comptable a pour objectif d’évaluer la santé financière d’une entreprise. Il examine pour ce faire la régularité et la fiabilité de la comptabilité de cette dernière par rapport à la législation et aux normes financières du pays dans lequel elle est établie.

Comment se déroule un audit financier ?

En général, un audit financier se compose de plusieurs phases :

  • Phase de préparation : l’auditeur va chercher à se familiariser à l’entreprise à auditer, au marché et au contexte dans lesquels elle évolue, et va établir les objectifs de cet audit (rassurer les actionnaires, convaincre les investisseurs, faire un état des lieux à des fins internes, etc.).
  • Phase de réalisation : l’auditeur passe en revue l’ensemble des comptes et des rapports annuels de l’entreprise afin de remplir les objectifs déterminés à l’étape précédente.
  • Phase de conclusion : l’auditeur produit un rapport sur les comptes de l’entreprise et formule des recommandations sur les points d’amélioration à mettre en place ainsi que les erreurs à éviter ou à ne pas répéter.

L’audit financier permet donc d’obtenir une vision d’ensemble précise et actuelle de la situation financière d’une entreprise, mais aussi d’attirer l’attention sur des points importants pour la pérennité de ses activités (améliorations à mettre en œuvre, risques financiers à éviter, etc.).

Qui effectue l’audit financier ?

Qui peut devenir auditeur financier ?

Plusieurs personnes sont à même de remplir le rôle d’auditeur et d’ainsi réaliser un audit financier :

  • Un commissaire aux comptes (dont c’est le métier principal)
  • Un salarié d’une société spécialisée dans l’audit
  • Un expert-comptable
  • Quiconque disposant d’un Master dans un domaine financier et justifiant des connaissances adéquates

En résumé, la personne chargée de réaliser l’audit doit disposer de connaissances financières approfondies et doit être formée à cette opération.

Un audit financier est une opération sensible qui ne s’improvise pas !

Les différents types d’audit financier

À noter que l’audit peut se faire de façon interne ou externe :

  • L’audit interne est réalisé par un employé de l’entreprise auditée lorsque la demande émane d’elle-même. L’auditeur va ainsi vérifier que les opérations se déroulent conformément aux principes établis par la direction en menant l’enquête sur le terrain, auprès du personnel, mais aussi en observant la façon dont les procédures sont exécutées. L’audit interne est principalement réalisé au sein de grands groupes.
  • L’audit externe, lui, est effectué par une partie tierce lorsque la demande provient d’un commanditaire autre que l’entreprise, notamment lorsqu’un organisme souhaite examiner les comptes d’une entreprise avant de lui octroyer une certification spécifique. L’audit externe peut également être mandaté par l’entreprise elle-même, dans un souci d’impartialité.

Pour quelles raisons effectuer un audit financier ?

En soi, l’audit financier a deux fonctions :

  • Une fonction de contrôle : lorsqu’une entreprise veut obtenir une certification auprès d’un organisme officiel, par exemple, celle-ci se doit d’être en mesure de montrer patte blanche. L’objectif est de prouver qu’elle est gérée correctement, mais aussi que ses activités ne sont pas frauduleuses. L’auditeur va alors examiner les comptes de l’entreprise de A à Z afin de déterminer qu’elle est bien en règle.
  • Une fonction de prévention : l’audit financier sert également à faire le point sur la méthode de gouvernance actuellement en place dans une entreprise. Le but ici est d’obtenir des recommandations de mesures à prendre pour améliorer la façon de diriger la société à l’avenir.

Enfin, n’oublions pas que l’audit financier porteur de bons résultats est un gage de confiance pour les startups à la recherche de fournisseurs et d’investisseurs. En effet, ces derniers seront plus disposés à collaborer avec des startups fiables et en bonne santé !

Votre PME ou votre startup souhaite réaliser un audit financier…

La première étape est de s’assurer que vous disposez bien de toutes les données nécessaires à la réalisation de l’audit financier : comptes de l’entreprise, rapports annuels, référentiels, etc. Ces documents devront également être facilement accessibles par l’auditeur. Vous pourrez alors faire appel à une société spécialisée dans les audits financiers. Celle-ci se chargera de toutes les phases du processus et vous remettra un rapport détaillé de votre situation.

L’audit financier est un terme moins effrayant qu’il n’en a l’air. En effet, les entreprises correctement dirigées et conformes aux normes et aux législations financières n’ont rien à craindre. Mieux : elles ont tout à y gagner !

Vous souhaitez en savoir davantage sur les logiciels relatifs à l’audit financier ? Consultez le catalogue Capterra des outils d’audit !

Und wie machst du deine Buchhaltung?

header image buchhaltung nutzerstudie

header image buchhaltungssoftware nutzerstudie

Buchhaltung noch per Hand oder in Excel? Wie läuft das so für dich? Nicht so toll? Du denkst darüber nach, eine Buchhaltungssoftware zu benutzen? Oder bist du unzufrieden mit deiner jetzigen? Hier die gute Nachricht: Wir haben mit über 500 kleinen und mittelständischen Unternehmen darüber geredet, ob sie eine Buchhaltungssoftware nutzen und wie zufrieden sie damit sind. Hier die Ergebnisse. Wir hoffen, dass dir dieser Artikel bei der Suche nach der optimalen Lösung hilft.

Ein erstes Ergebnis: Weniger Software im Einsatz als gedacht!

buchhaltung führen - Buchhaltungssoftware

Von 528 befragten Unternehmen setzen nur 241 (45,64 %) eine spezielle Buchhaltungssoftware ein – 287 (53,14 %) erledigen ihre Buchhaltung noch mithilfe einer Tabellenkalkulation wie Excel oder auch per Hand. Wir hatten mit einer deutlich höheren Adaptionsrate für dezidierte Software gerechnet. Und damit nicht genug, auch die Art der typischen Software widersprach unseren Erwartungen.

Die typische Software im Einsatz: Offline und ein bisschen meh

installierte oder cloud software

Von den 241 Unternehmen, die eine Buchhaltungssoftware einsetzen, verwenden ganze 72 % eine lokal installierte Software, gerade einmal 21 % setzen auf eine Cloud-Lösung. 73 % der Lösungen kommen anscheinend ohne mobile App – oder zumindest nicht mit einer mobilen App, die auch tatsächlich genutzt wird.

mobile app buchhaltung

Natürlich könnte das alles dadurch erklärt werden, dass die Benutzer sich keine mobile Lösung aus Cloud + App wünschen. Das widerspricht aber einem anderen Ergebnis der Studie: Immerhin 43 % der Befragten bezeichnen die Möglichkeit, ihre Buchhaltungssoftware mobil zu nutzen als wichtig oder sehr wichtig; wogegen nur 23 % dies als unwichtig bezeichnen. Vielleicht trägt diese Diskrepanz zu einem der wichtigsten Ergebnisse unserer Studie bei: Die meisten Benutzer finden ihre eingesetzte Buchhaltungssoftware wohl nicht so den Hammer. Immerhin 53 % der Befragten, die bereits eine Lösung einsetzen, geben an, dass sie unzufrieden sind und planen auf eine andere Lösung zu wechseln.

meh

Anwender beim Arbeiten mit einer typischen Buchhaltungssoftware

 

unzufriedenheit mit Buchhaltungssoftware

Geht das auch besser? Wie würde das aussehen?

Die hohe Zahl an Anwendern, die unzufrieden mit ihren Lösungen sind bzw. immer noch auf Excel oder Papier setzen, weist darauf hin, dass es noch keiner Lösung gelungen ist, für die breite Masse an kleinen und mittleren Unternehmen attraktiv zu sein. Spekulieren wir kurz: Wie müsste eine solche Lösung aussehen?

  • Cloud nutzen: Es ist 2020. Wir wollen unsere Buchhaltung auch mal im Zug oder in einem Café machen. Außerdem lassen sich Cloud-Lösungen meist schneller und unkomplizierter testen, bevor man Geld investiert. Auch wenn im Moment noch wenig Cloud-Nutzer unterwegs sind, wir sind uns ziemlich sicher, der Trend wird in diese Richtung gehen.
  • Tolle Mobile App bieten: Das ist schlichtweg ein Mindeststandard für jede Lösung, die heute auf den Markt kommt. Die Anwender wollen das und sollten es auch bekommen.
  • Aktuelle Gesetze umsetzen: Schwierigkeiten, immer mit den aktuellen gesetzlichen Vorgaben mitzuhalten, sind das am häufigsten genannte Problem in Bezug auf die Buchhaltung (16%). Lösungsanbieter, die Ihre Kunden hier aktiv unterstützen, könnten einen echten Vorteil erringen.
  • Einfache, intuitive UI, die mitdenkt: Die häufigsten Fehler bei der Buchhaltung unterlaufen Anwendern von Softwarelösungen in Bezug auf den Umgang mit Rechnungsnummern und anderen Rechnungsdaten (32 %) und dem Angeben der MwSt. und anderen steuerlich relevanten Informationen (16 %). Eine klar strukturierte UI, die mitdenkt und auf Probleme aufmerksam macht, kann hier helfen, Fehlerquellen zu vermeiden (z. B. indem ein Pop-up darauf aufmerksam macht, wenn ein Posten noch keine MwSt. verwendet).
  • Das richtige Preismodell: Es gibt eine ziemlich klare Präferenz, was den Preis einer Buchhaltungslösung angeht. Der Preisbereich von 11 bis 50 Euro pro Benutzer und Monat war der klare Favorit unserer Umfrage.

investitionsbereitschaft in neue Buchführungssoftware

Fazit: Raum für Wachstum

Buchhaltung scheint dafür gemacht zu sein, durch Software zumindest teilautomatisiert und beschleunigt zu werden. Und wir vermuten, dass sich nur wenige Anwender dagegen sträuben, weil ihnen die Buchhaltung so viel Spaß macht. Wann haben Sie sich das letzte Mal gedacht „Juchu, es ist Freitagnachmittag. Endlich habe ich Zeit, die eingegangen Rechnungen in Excel einzutippen!”? Genau … nie!

Für uns deutet das darauf hin, dass es ein Riesenpotential für eine Lösung gibt, Unternehmer zur Verwendung einer Buchhaltungssoftware zu bewegen und bereits bestehende Anwender zum Wechsel ihrer Lösung anzuregen. Wer die oben genannten Kriterien erfüllt und dies potenziellen Kunden auch vermitteln kann, könnte große Erfolge feiern. Das könnte einem der bestehenden Lösungsanbieter gelingen oder auch einem Newcomer. Und wer heute auf der Suche nach einer Lösung ist, kann unsere Kriterien als eine Art erste Checkliste nutzen. Auch wenn sie den Markt noch nicht erobert haben, es gibt sicher schon Lösungen, die jedes Häkchen an unserer Liste setzen können.

Bist du auf der Suche nach der idealen Buchhaltungssoftware für dein Unternehmen? Schau dir unsere Liste mit den besten Buchhaltungs-Tools an!

Making Tax Digital: How to get your business ready

making tax digital

The UK government wants to build “one of the most digitally advanced tax administrations in the world.” But what does this mean for your small business?

making tax digital

What is Making Tax Digital?

Anybody who’s had to fill out a tax return – whether for themselves or a business – knows how time-consuming, stressful, and confusing the process can be. That’s why the accountancy services industry exists – to help navigate the complexities of paying tax correctly and on time. According to its own data, the Consultative Committee of Accountancy Bodies says the sector employs more than 600,000 people and contributed £21 billion to the UK economy in 2017.

But steps are in place to make the whole process more efficient, more effective, and less prone to error. This, says the government, will be good news for taxpayers, accountants and HMRC alike. Preventable mistakes cost the Exchequer £9.9 billion alone each year.

In a nutshell, Making Tax Digital (MTD) requires businesses to keep digital financial records and complete tax returns using software. VAT has been digital since April 2019, and HMRC is encouraging taxpaying entities to use MTD for other taxes, too. However, the government has announced that it will not mandate MTD for new businesses or taxes in 2020.

How ready are businesses?

Last year, we surveyed over 400 self-employed people and small businesses (with under 250 employees) from a range of industries about how they are preparing for MTD.

Back in September, 55% of respondents said they didn’t feel confident about their understanding of the scheme. The main difficulties they encountered were lack of information (31%), the cost of finding a new software or upgrading the current one (15%) and finding a compliant software (13%).

The use of software for account-keeping was fairly high across respondents. 42% use dedicated accounting software, 47% use a spreadsheet like Google Sheets or Microsoft Excel, and 11% still keep records on paper.

MTD is all about software – but where to start?

For small businesses with simple accounting needs, a spreadsheet makes sense. But as your business grows, the limitations soon become clear. As more people need access to a file, ensuring consistency (and regulatory compliance) becomes hard to manage. As you need to move data between sheets and systems, the manual work involved in copying and pasting – not to mention the likelihood of introducing errors – soon adds up.

Spreadsheets can be used to submit tax returns under MTD, but doing so is far from easy. In fact, the desire to continue to use spreadsheets has led software companies to develop “bridging” products, which convert data in spreadsheets into an MTD-readable format.

Using accounting software to keep accounts and submit tax returns is a good idea. It keeps your financial data in one place and can help with data security. The right people have visibility into cash flow, invoicing, payroll, and other information in real-time. Software can also help your business save time in bookkeeping, auditing and managing tax.

What do I need to do now?

The first step is to understand if MTD applies to your business. As things stand, only companies whose turnover exceeds £85,000 must use the system, and only for VAT. This has been the case since April 2019. You can find out more about MTD for VAT on the GOV.UK website.

To prepare for the wider application of MTD, sole traders and landlords can sign up to the pilot scheme for income tax. This will require you to use approved accounting software and submit information about your income and expenses to HMRC each quarter. Again, full details again are on GOV.UK.

If neither of the above applies to your business, it is still a good idea to prepare for MTD. Consider how you currently record financial information. If you use software, is this compatible with MTD?

If you use spreadsheets, explore bridging software and look at the advantages and disadvantages. You may be better off migrating to dedicated accounting software. If you use pen-and-paper bookkeeping, there’s no better time to look at digitising your processes.

In another blog post, we explored six popular accounting software packages, all of which are reviewed and rated by small businesses like yours and available on our website.

Banking after Brexit: A quick guide for small businesses

banking after brexit

Brexit has happened, but now what? It’s likely going to have a major impact on many areas for businesses—one of them being online banking. 

In this article, we will look at what measures are in place at present for small and medium-sized businesses (SMEs) looking to do business with EU companies after 31st January and what measures have banks taken for a no-deal Brexit.

banking after brexit

What has changed for small businesses?

The final information is yet to be decided but the government’s website has posted some financial advisory tips for UK nationals for Brexit. The page contains key information on things like making transfers across the EU and using debit and credit cards from the UK while in the EU. 

One of the main concerns for small businesses dealing with the EU is how trading (buying and selling goods and/or services) is going to be affected. 

At the Paris Fintech Forum last year, one of the most discussed topics was the future of banking after Brexit, especially after a no-deal Brexit. At the time, people weren’t sure if there would be a hard Brexit, however, one of the key topics amongst the participants was how they could better prepare for it.

Banks have been preparing for the worst for the past months: A no-deal scenario. The question is, how can they offer a service in a post-Brexit Britain that includes borderless service and online banking like they have been doing until now?

Small businesses are banks’ most precious customers

Banks have taken measures to make sure the impact of Brexit is the lowest possible for customers. Small businesses are one of the most important customers for banks. The number of SMEs today in the UK account for 99.99% of the business population (around 5.9 million businesses), and they are key for the creation of jobs in the UK but also an instrumental customer group for the banking industry. 

Online banking has been one of the go-to resources for small companies as it offers many advantages that are suited to a small business. These include the ease of monitoring accounts, being able to access a bank account from anywhere rather than having to waste time going to a physical branch.

But the banking landscape has been changing for the past ten years, with the arrival of the digital banks (also known as challenger banks) such as Starling Bank, Revolut and Monzo and fintech entities such as TransferWise. These banks target specific sets of financial needs and are not constrained by legacy systems, making it possible to offer a better-tailored type of product to SMEs.

Opening an office in Europe, the chosen solution  

Before Brexit, British banks could operate throughout the EU block with a domestic banking license, the same as any other financial institution from the EU. 

This will likely change now that Brexit has happened.  And the reality is that most banks have been opening offices in Europe to prepare for this. Banks applied for licenses in EU countries ahead of the deadline and have started opening offices in key European cities, such as Dublin, Brussels, Paris or Frankfurt, to be able to continue providing services to customers that need to do business between the UK and the rest of Europe. 

This will likely be a key differentiator for banks in a post-Britain Brexit: Those banks that offer easy links with the EU, will probably attract those companies that need to continue trading with the EU.

As an example, TransferWise has published a statement on its website explaining how the firm has been granted a new license to operate in Europe and has a new office in Brussels. The company also states that the operations from this separate entity will be ‘regulated by Belgian laws.’

Digital bank Revolut also released a statement via its blog just a few days before Brexit, reassuring customers and announcing that the bank has a European entity, Revolut Payments UAB, that will allow customers to continue to trade with the EU.

On its website, Starling Bank states that the bank has opened an office in Dublin to ‘enable our expansion there and to act as a springboard to our wider European expansion, starting in the Netherlands, France and Germany.’

“Businesses of all sizes have customers and suppliers spread across different countries. Our business euro account which launched in October [2019] is already making a huge difference to these kinds of business customers, who are regularly carrying out international transactions whilst operating on a tight budget.”

Anne Boden, founder and chief executive of Starling Bank

Banks will continue to work to provide the best service after Brexit

It’s still uncertain what the final agreements of Brexit will be, and there is still a lot that needs to be defined in terms of regulation and how this will affect customers.  

What is clear is that digital banks and fintech firms are aiming to make sure that they continue to provide the same service to their customers with the least possible impact. 

How is this impacting your business? Tell us in the comment section below or send me a tweet to @SoniaNM55, I would love to hear from you!

If you are a bank and need some help, take a look at our Online Banking Software and Banking Software listings to see how Capterra can help.

FinTech qué es y cómo funciona: la revolución digital de la banca

FinTech qué es

FinTech qué es

Si pagas usando tu smartphone o has enviado dinero con una app, estás usando parte de un mercado multimillonario que está revolucionando el mundo financiero: FinTech. Según los datos más recientes, en España existen más de 380 startups de FinTech. Estas, junto con un software para gestionar las finanzas y la contabilidad, se están convirtiendo en las herramientas tecnológicas idóneas para las empresas. En este artículo te ayudamos a conocer más sobre FinTech qué es y cómo funciona.

FinTech qué es y cómo funciona

FinTech es el diminutivo de Financial Technology (en español, tecnología financiera) y se basa en el uso innovador de la tecnología en el diseño y la entrega de servicios financieros tanto para particulares como para empresas.

¿Te has frustrado alguna vez con tu banco porque no te dejaba hacer alguna operación online? FinTech ha surgido precisamente para responder a la necesidad de reducir la brecha tecnológica que existe entre los servicios que los bancos tradicionales ofrecen y las expectativas de los usuarios, los cuales estamos cada vez más acostumbrados a realizar todo online.

Las FinTech desarrollan aplicaciones accesibles para ofrecer mejores soluciones financieras tanto a particulares como a empresas. Si bien las FinTech aún no están en posición de sustituir al 100% la banca, sí que añaden valor a los servicios financieros que ofrece la banca tradicional, con servicios de menor coste, más transparencia y con la posibilidad de comparar entre varias ofertas.

Si quieres conocer más sobre FinTech qué es y cómo funciona, así como las ventajas de utilizar este tipo de servicios, te invitamos a seguir leyendo.

¿Qué diferencia hay entre FinTech y los servicios financieros que ofrece tu banco?

La diferencia más notable entre los servicios de los bancos tradicionales y los ofrecidos por las FinTech, es que en el caso de las FinTech los servicios son mucho más accesibles y fáciles de gestionar para todo tipo de público, tanto para particulares como para pymes. Se puede gestionar todo a través de una app instalada en el smartphone y una conexión a internet.

Una tendencia en los usuarios españoles es contratar productos y servicios financieros utilizando un entorno totalmente digital. Algo que hoy en día solo es posible gracias a las FinTech.

Cada vez son más las ventajas de las FinTech frente al uso de los servicios de un banco tradicional. Estos últimos aún no son capaces de competir con las FinTech, tanto en lo relacionado con los costes de determinados servicios, ni en cuanto a ofrecer las facilidades de acceso y operativa que las nuevas herramientas tecnológicas sí nos ofrecen.

¿Qué actividades financieras cubre FinTech?

Ahora que ya sabes un poco más sobre FinTech qué es y cómo funciona, seguro que quieres saber un poco más sobre qué productos o actividades financieras puedes realizar con este tipo de tecnología.

Hoy en día, las FinTech permiten tanto a individuos como a empresas realizar varias operaciones que tradicionalmente se hacen con la banca tradicional. Aquí te dejamos algunas de ellas.

Préstamos y créditos

Muchas pymes se enfrentan al problema de no poder acceder a financiación por parte de los bancos, los cuales en muchos casos deniegan la petición de créditos o préstamos.

Por ese motivo cada vez más las empresas que usan las soluciones FinTech a fin de acceder a préstamos y créditos. Algunos de los métodos más utilizados para conceder un préstamo o crédito a una pyme son los de tipo P2P (peer to peer) y los denominados Crowdlending o Crowdfunding.

En ambos casos la financiación proviene de otras personas o empresas que están dispuestos a invertir en proyectos innovadores a cambio de una rentabilidad y por los que la banca tradicional prefiere no apostar.

Gestión automatizada de procesos

A nivel de empresa, ya sabes lo importante que es llevar bien el control de los procesos y actividades financieras. Dentro de los productos FinTech, encontramos herramientas de gestión financiera tipo ERP y plataformas para gestionar los gastos de empresa. Estas herramientas facilitan el trabajo en materia de gestión reduciendo costes y facilitando el seguimiento y control.

Pagos y transferencias

A fin de evitar la dependencia exclusiva a una entidad bancaria, muchas empresas cuentan con productos FinTech que facilitan las operaciones de pago por parte del cliente, proveyendo soluciones como los TPV virtual o físico. Estos últimos permiten incluso a los clientes pagar en el punto de venta usando una aplicación en su smartphone.

En el caso de las transferencias, cada vez aparecen nuevas soluciones FinTech que permiten realizar movimientos entre cuentas bancarias incluso entre dos países utilizando distintas divisas. Hay una gran ventaja al utilizar estas soluciones, principalmente porque los costes en comisiones por transferencia, que habitualmente son elevados usando la banca tradicional, se reducen significativamente en FinTech.

¿Qué tipo de tecnología usa FinTech?

El objetivo principal de las FinTech es facilitar y simplificar al usuario los servicios bancarios. Para eso, utilizan tecnologías como la inteligencia artificial, tecnología móvil y el Blockchain.

Inteligencia Artificial

Estos sistemas utilizan Big Data para analizar datos y en el caso de las FinTech, el uso de estos sistemas permite anticipar y medir las necesidades de un individuo o una empresa y así ofrecer soluciones financieras que satisfagan unas necesidades específicas.

Un ejemplo de ello son los conocidos como robo advisors (del inglés, asesor robótico) utilizados en el entorno de las inversiones. Estos se adaptan y personalizan según las necesidades de los clientes, independientemente del tamaño de la cartera y el precio de las tarifas. El uso de esta tecnología permite la reducción considerable de costes para los clientes y entidades a la hora de invertir.

Tecnología móvil

Las FinTech están desarrollando apps que permiten realizar muchas de las operaciones en las que habitualmente usamos servicios que provee la banca. Un ejemplo de ello es el pago mediante la tecnología contactless usando el móvil a través de la comunicación NFC.

Blockchain

El blockchain (del inglés, cadena de bloques) se trata de una estructura en forma de bloque de datos que incluye información horaria sobre las transacciones. Esta cadena se replica en la red mundial de servidores implicados a tiempo real, de esa forma se puede construir una base de datos segura con información real sobre las transacciones realizadas. Esta tecnología se usa sobre todo a nivel de inversiones con criptomonedas.

¿Cómo se puede beneficiar tu empresa usando FinTech?

Ahora que ya sabes un poco más sobre FinTech qué es y cómo funciona, seguro que te preguntas si vale la pena implementar este tipo de soluciones en tu empresa.

Uno de los beneficios de las FinTech para las pymes, es el ahorro que presenta, ya que permiten realizar gestiones más rápidas y automatizadas, lo que se traduce en menos tiempo y dinero empleado realizando operaciones financieras.

Otro de los beneficios es la facilidad en las transacciones financieras internacionales. Para las pymes que quieren dar el salto hacia el exterior, los elevados costes que se derivan de las operaciones bancarias internacionales suponen una barrera. Las FinTech permiten superar esta barrera, ya que se trata de empresas que suelen entender bien las necesidades relacionadas con la internacionalización.

Las FinTech tienen un futuro muy esperanzador por delante y todo apunta que serán un gran aliado para las pymes y particulares que quieren una alternativa o complemento a la banca tradicional.

Payroll processing: What Is It? And How To Get Set Up

monthly payroll processes

Payroll processing refers to the steps taken to pay employees for each pay cycle. It takes into account the employee’s salary, working hours, bonuses, benefits, and tax remittance. 

On the surface, that may sound quite straightforward. In reality, payroll can be a complex process—especially for someone with little to no finance background. In this article, we cover the basics of payroll processing and highlight the technology you’ll need to begin.

monthly payroll processes

Who should handle payroll within a small business?

According to ABS data, there are approximately 781,908 businesses with 19 or fewer employees in Australia. That’s around 36.8% of Australian businesses. In most cases, these companies don’t have in-house finance management. 

For a small business that doesn’t have a dedicated payroll administrator, payroll processing often falls to the business owner. There is a lot to consider when filing multiple payroll records.

With that in mind, it’s worth investigating the option of payroll software, third-party outsourcing, or a combination of both.

Why businesses need an efficient payroll process

Your employees are your best resource, so it makes sense to look after them and their remuneration. Beyond perks and benefits, the first thing businesses have to ensure is:

  • Employees receive an accurate pay rate
  • Salaries get paid on time
  • Management of annual leave (and other types of leave) is correct
  • Commissions and bonuses are honoured.

These processes should be smooth, seamless and without any major issues. As a business grows, technology can help an organisation to handle multiple employee salaries at once.

In-house payroll vs outsourcing: which should you choose?

Inhouse vs outsourcing payroll process

A big choice you need to make before investing in any software is whether to keep the function in-house or outsource it to a third-party. The decision is crucial and could save your business thousands of dollars. 

Let’s look at the benefits and challenges of each:

Outsourcing payroll

Benefits:

Here are a few ways a company might benefit from outsourcing the payroll process:

  • Time-saving: The main benefit of outsourced payroll processing is the amount of time saved from the endless hours spent calculating pay, deductions and keeping track of income tax withholdings.
  • Avoid mistakes: With payroll comes workplace agreements and EBAs. When a mistake happens, it can be costly. Third-parties ensure the minimum standards are adhered to.
  • Focus on core business activities: By outsourcing payroll to a third-party, organisations can focus on the functions that generate revenue and drive growth.
  • Security: A good payroll processing service will have robust payroll systems that are fully secure. Sensitive information is therefore protected by the company.
  • Peace of mind: The hassle and pain often associated with payroll processing are mitigated through the help of experts. 

Challenges:

Outsourcing also has its shortcomings. It costs more than software, and even though you’re putting the process in the hands of specialists, there is still potential for human error. 

In-house payroll management

Benefits:

Here are just a few reasons to bring the payroll process in-house:

  • Cost: The upfront cost may be larger initially because you’ll need to purchase and implement software. However, the processing of payroll is extremely cost-effective in the medium to long term.
  • Data control: Sensitive information, such as salaries, benefits and work status remains in-house. The data remains on a secure database owned and managed by you, giving you greater control. 
  • Flexibility: Changes, such as deductions or salary increases, are easy and quick to apply.
  • Employee empowerment: Payroll platforms should include the option to self-service. This means employees have access to the platform and can take responsibility for keeping their data up to date.
  • Fee transparency: The price of payroll technology is consistent and transparent. A third-party may provide extra fees for activities such as changes, or adding overtime.

Challenges: 

In-house payroll processing is the less expensive option, but there are some extra costs that businesses may need to consider. 

Even if a business has 19 or fewer employees, by law they’ll still need to purchase a single touch payroll software. This is because the Australian Government requires businesses to report payroll information to the Australian Taxation Office (ATO).

However, don’t view the requirement as a punishment. Payroll platforms make the process significantly more manageable. Instead of administrators having to manually calculate and pay salaries, wages, taxes and super, they can simply automate it.

How much does payroll software cost?

In a recent poll that we put out to 250 Australian customers, we discovered than 98% of people will read through reviews and compare a product, service or software before buying. When we asked which piece of information within a product listing was most vital, 85% of people cited pricing.

So, how much will payroll technology set you back? Some common factors determine the cost. These include:

  • The pay cycle
  • The total number of employees
  • How many states your employees reside in
  • Whether you require direct deposit
  • Demand for additional tax filing-services.

Most payroll programs have a per-employer or per-paycheck fee, on top of the base account fee. The base fee varies per software, but you can expect to pay anything between AUD$20 to $100 per month. 

Additional fees, such as a one-off set up fee, may also apply. Before committing, it’s worth exploring payroll software that offers free trials

What are the features of a payroll system? 

Here are five features you should pay attention to when investigating software platform options: 

Setup and support

When you first use the software, you’ll need to enter your company’s and employee’s information. Guidance from the software company will make it easier to transition your current payroll system to a software program. They will also help with any teething issues you face and provide some basic training.  

Payrolling processing

The platform you choose should automatically calculate the pay for individual employees every pay period. The system takes into account updates to wage rates, hours worked, overtime, holiday pay, and taxes. It will also factor in relevant deductions.

The platform then automatically makes the payments to employees by direct deposit, prepaid debit cards or a paper check. 

File and pay payroll taxes

Taxes are the most challenging aspect of the process, which is why the Australian Tax Office insists that small businesses should submit reports through single-use payroll software. The program calculates taxes for you, and some file and deposit payroll taxes for you too.

Ensure the platform you select stays up to date with changing payroll laws and tax rates. A cloud-based platform should apply these updates automatically for you. 

Multiple payment options

Payroll software allows you to pay employees electronically—one option is via direct deposit. You can pay the employee’s wages directly into their bank. This way, there’s no need to print and distribute paychecks. 

Other payment options include:

  • Digital payments: Send salary to platforms, such as PayPal. 
  • Paper checks: A system that doesn’t get used often today, but could be useful for companies with very few employees.
  • TransferWise: A useful option for those who have employees abroad.
  • Prepaid Debit Cards: This method is similar to direct deposit, but exists for workers without bank accounts.

Having these alternatives allows employees to be flexible to those who don’t want to be bound to traditional banking.

Employee self-service portal

Allowing staff to log into the portal and update their paperwork is a useful feature for payroll administrators. They can also review and download their payroll history.

This aspect also works well with time-tracking. Employees pay will automatically update according to the data. 

How to choose payroll software

When it comes to exploring what options are available to you, refer to this article as a checkpoint. We’ve included all the crucial aspects you’ll need to decide which solution will suit your needs best, the expected budget, and the benefits you’ll see in return. 

Ready to purchase payroll software? Check out Capterra’s software buyers guide to selecting payroll software today. 

What is IR35 and is your business ready for it?

what is IR35
In April 2020, the rules governing who counts as an employee (IR35) are changing. Find out what is IR35, what it means for UK businesses, as well as their contractors and freelancers.

what is IR35

What is IR35?

The original IR35 legislation came into force in 2000 and was aimed at reducing tax avoidance – specifically “disguised employment”. This refers to individuals working full-time for organisations, but billing the company as an independent contractor, rather than being paid through payroll. Taking their “salary” as dividends from a limited company means they pay no National Insurance and a reduced rate of income tax compared to pay-as-you-earn (PAYE) employees. It also means the client company pays less National Insurance.

Naturally, this scenario is beneficial for the businesses and contractors, but HMRC misses out on significant tax revenues, particularly as the contractors that often use this arrangement are in the well-paid finance, consulting, technology, and media sectors.

How is IR35 changing?

IR35 (the name comes from the original Inland Revenue press release in 2000) has been reformed several times. In April 2020 the regulations governing when off-payroll working rules (the “official” name for IR35) apply are getting tougher.

Prior to 6 April 2020, it has been the responsibility of the party providing a service to determine the status of a worker’s employment for each contract. In practical terms, this usually means that contractors, working through a limited company with one director, decide in their own favour. Now, the company hiring the worker must decide.

Who do the new rules affect?

Public sector organisations must already decide whether a contractor should really be working for them as an on-payroll employee. From 6th April this year, many private companies – including charities – will have to do the same. The changes apply if an organisation meets two or more of the following three criteria:

  • an annual turnover of more than £10.2 million
  • a balance sheet total of more than £5.1 million
  • more than 50 employees

Current contractors must also take note of the changes, as they may affect their employment and tax arrangements. Some contractors work through third-party intermediaries, such as employment agencies, in which case the intermediaries must also be aware.

You can find more detailed information about which companies fall under the new legislation on the Gov.uk website.

What companies need to know

For every contract with a worker – including through an agency – affected companies will need to decide on that person’s employment status for tax. HMRC provides a useful online tool to help determine this. You must bear in mind:

  • The worker’s responsibilities
  • The degree of autonomy they have in the work they do, as well as where, how, and when they do it
  • The worker’s payment arrangements
  • Whether the engagement includes any corporate benefits or reimbursement for expenses

After you’ve made a decision, you’ll need to inform the worker (and, if required, the intermediary agency) and keep a record of the decision and the evidence you used to make it. You’ll also need to have in place procedures to handle disputes about employment status. If a worker does dispute your decision, you must respond within 45 days. Failure to do so will result in that worker’s tax and National Employment contributions becoming your responsibility.

How to manage new employees

If the reform has its intended effect, some freelance contractors will become employees. This means you may be adding new workers to your workforce, increasing your National Insurance contributions and bringing challenges for your human resources and finance teams who will have to incorporate new people into your company’s systems and structures. You may also face tough negotiations from existing contractors who will seek higher rates under PAYE to make up for the increased tax they’ll be paying on their income.

One way to ease the transition is with payroll software, which automates salaries, wages, bonuses and deductions. Organisations use it as a cost-effective alternative to outsourcing their payroll function. Payroll products can also integrate with popular accounting, HR, and business management software, too.

You can find more than 300 payroll software packages on our website, with thousands of ratings and reviews from other businesses, as well as links to download and buy.