Many financial controllers wonder : "Should expenses be paid through payroll?" Working this way can cause headaches for finance teams and employees, with no spend visibility until the end of each month and prolonged reimbursement delays for employees. Learn in this blog how you can overcome payroll expensing challenges.
If your business is scaling, it's likely that so is your finance team. But no matter the size, with tracking and paying expenses, making payroll, setting budgets, preparing for the tax season, and more all falling under one department, you're likely looking for ways to make managing financial processes easier and more transparent.
Take expenses, for example. Some companies pay expenses through payroll, but this isn't ideal as it can leave employees out of pocket and waiting until the end of the month to be reimbursed. It also leaves finance teams in the dark about expenses instead of giving them vital real-time visibility over company spending.
Payroll is a term that refers to the total amount of money you pay your employees as regular income. It's also the process of managing and distributing those funds. The employer usually makes these payments to an employee can be as frequent as a daily, weekly, or monthly salary.
Payroll processing services can also involve calculating, recording, and sending required payroll information to employees and reports to government agencies regularly.
Payroll, taxes, and National Insurance contributions (NIC) are typically deducted from the employee's paycheck or the employer's account. These contributions depend on what kind of business you have and where you're located. Some jurisdictions also allow for different rates for different professions or industries.
Smart spend management solutions, like Payhawk, feature expense management software equipped with automated data entry and automatic receipt chasing.
Payhawk has many benefits over traditional payroll processing systems. For example, employees can save time waiting for approvals or sending emails to request reimbursements. And they also don't need to worry about losing receipts or losing track of all their expenses. Instead, they can make a purchase, enter their associated receipt via the platform, and get reimbursed instantly using the mobile app from anywhere with an internet connection.
Or even better, they can use a corporate visa card from Payhawk, which is directly connected to the expense software and topped up with funds according to budgets (so no need for reimbursements at all). The benefits of managing expenses via company cards powered by clever expense management software include the following:
Adding more work to your accounting system can cause more headaches than it's worth and increase costs related to compliance issues such as audits and record-keeping requirements from HMRC.
Furthermore, using an automated solution like Payhawk provides several advantages over traditional payroll processing methods:
Our platform integrates with many major accounting software providers, such as Exact, Xero, and QuickBooks. We also integrate directly with some popular ERP solutions, like NetSuite. The seamless integrations and instant data syncs are among the reasons finance teams around the world trust Payhawk to make managing expenses more straightforward.
In today's fast-paced world, finance teams need a more streamlined approach to employee expenses. Spend management solutions, like Payhawk, can help businesses avoid the pitfalls and drawbacks of paying expenses through payroll.
Ready to hear more? Book a demo today, and let's talk about easy expense management.
Trish Toovey works across the UK and US markets to craft content at Payhawk. Covering anything from ad copy to video scripting, Trish leans on a super varied background in copy and content creation for the finance, fashion, and travel industries.