Running payroll is often a cumbersome task for small businesses. Keeping up with changing regulations and manually entering data into separate accounting software can be extremely inefficient.
Luckily, solutions like QuickBooks Payroll aim to streamline payroll and accounting in one integrated platform.
By automating manual processes, it can help SMBs achieve new levels of productivity and cost savings.
In this review, we'll explore the key features of QuickBooks Payroll, including its tight integration with QuickBooks Accounting. We'll look at the specific benefits this delivers for streamlining workflows, reporting, and more. We'll also consider some key factors for SMBs to weigh when deciding if QuickBooks Payroll is the right solution for their business.
Introduction
QuickBooks Payroll is an integrated payroll management solution designed specifically for use with QuickBooks Accounting software. It allows businesses to handle all payroll and accounting tasks in one place, eliminating the need for separate systems.
What is QuickBooks Payroll
QuickBooks Payroll is Intuit's online payroll processing software. It enables businesses to calculate paychecks, withholdings, deductions, and taxes automatically based on employee pay rates and time tracking data. The software seamlessly integrates payroll functionalities into the QuickBooks Accounting interface for efficient financial management.
Key features include:
- Automated payroll tax calculations and filings
- Direct deposit setup
- Integration with QuickBooks Accounting
- Accessible from desktop and mobile
- Simple payroll setup wizard
Top Features and Benefits
Some of the main benefits of QuickBooks Payroll include:
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Accurate Payroll Taxes: QuickBooks Payroll automatically calculates complex payroll taxes using up-to-date federal and state tax tables. This eliminates manual errors.
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Integration with Accounting: Employee payroll data flows directly into QuickBooks Accounting in real-time. This enables seamless financial reporting and reconciliation.
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Multiple Payment Options: Pay employees via check, direct deposit, or pay card. Direct deposit setup takes minutes.
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Mobile Access: Manage payroll tasks remotely via iOS and Android apps. Useful for approving timesheets and paychecks on-the-go.
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Affordable Pricing: Reasonable monthly pricing options based on number of employees, with volume discounts available.
Integration with QuickBooks Accounting
A key advantage of QuickBooks Payroll is its tight integration with QuickBooks Accounting software.
When payroll is processed, all wage expenses, liabilities, and payments automatically sync with the designated QuickBooks company file. This includes:
- Employee payroll expenses syncing to QuickBooks expense accounts
- Payroll liabilities updating account balances
- Payroll payments reflected in bank and credit card accounts
With this two-way sync, users don't have to manually import or match data across systems. This saves significant time while reducing data entry errors.
The integrated solution provides an efficient financial management and reporting workflow. Users can seamlessly track payroll costs alongside other business expenses within QuickBooks. This delivers an accurate picture of profitability.
Key Benefits of Integration
Integrating Intuit QuickBooks Payroll with QuickBooks Accounting can provide several major benefits for small businesses looking to streamline operations.
Streamlined Payroll & Accounting Workflow
By integrating payroll and accounting systems, small businesses can eliminate the need for duplicate data entry across multiple platforms. Employee payroll data flows directly into the accounting system, keeping everything synchronized in real-time.
This saves the finance team significant time by removing manual workflows needed to reconcile payroll liabilities with accounting records. Instead of toggling between separate systems, all data is available in one place for straightforward payroll processing and accounting tasks.
Automated Journal Entries
Another advantage of integration is automated journal entries for payroll transactions. As soon as payroll is processed, the accounting system automatically logs wage expenses, tax liabilities, bank payments, and other journal entries.
Manual journal entry creation is error-prone and time consuming. Automated entries increase accuracy of financial records and reduce the accounting workload. The finance team can rely on the integrated system to handle these repetitive tasks.
Real-Time Reporting & Analytics
With unified payroll and accounting data, businesses gain access to real-time financial reporting and analytics. Dashboards and reports can provide insight into up-to-date profit and loss, labor costs, tax liabilities, and other key metrics.
Rather than waiting until month-end to analyze financial performance, integrated systems empower data-driven decision making with timely visibility. Business leaders can identify issues requiring attention or opportunities to pursue long before month-end reporting.
By eliminating siloed datasets and manual reconciliation, integration gives financial leaders the information they need to guide the business strategy.
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Key Features for Managing Payroll
QuickBooks Payroll provides several key features to help businesses efficiently manage payroll tasks and processes.
Easy Employee Setup
The software includes an intuitive wizard that makes it easy to add new employees. Within a few clicks, you can enter details like pay rates, benefits, deductions, and more to get new hires set up quickly.
Multiple Pay Schedules Support
Businesses can choose weekly, biweekly, semi-monthly, or monthly payroll schedules based on their needs and preferences. The flexibility to handle different pay cycles is useful for many companies.
Automated Tax Calculations
One major benefit is that QuickBooks Payroll automatically calculates all applicable payroll taxes and deductions each pay period. This saves the hassle of figuring out tax payments manually.
Direct Deposit
Employees can sign up for direct deposit to have their payroll funds directly transferred into their bank account. This feature simplifies payroll delivery so businesses don't have to manually distribute paychecks.
Considerations for SMBs
Startup Costs
QuickBooks Payroll has competitive startup pricing, but ongoing costs can add up for very small businesses. Here are some key considerations around costs:
- Initial setup and training fees range from $100-$300 depending on complexity.
- Subscription plans start at $45/month base fee plus $4 per employee. With only 1-10 employees, that monthly cost is reasonable.
- Additional fees apply for tax forms, direct deposit, quarterly/year-end filings, etc. These "extras" can potentially double the monthly costs.
So while QuickBooks Payroll keeps it simple for basic payroll needs of small teams, costs scale rapidly as complexity increases. Very small businesses should evaluate if more basic payroll services better fit their budget.
Payroll Complexity
As an integrated platform, QuickBooks Payroll provides extensive capabilities like:
- Automated tax calculations and payments
- Direct deposit setup
- Managing vacation/sick time accruals
- Customizable pay stubs
- Reporting for analysis
However, SMBs with specialized needs around union dues, garnishments, complex commissions, etc. may find QuickBooks lacking. While integration with QuickBooks accounting is convenient, larger enterprises may require a more customizable payroll system.
So QuickBooks works well for straightforward payroll, but has limitations scaling to more complex requirements. As teams grow, evaluate if advanced platforms like ADP or Paychex better suit the needs.
Alternatives
A few alternatives SMBs could consider instead of QuickBooks Payroll:
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Gusto: Competitive pricing starting at $39/month. Integrates with various small business accounting platforms. Best for very simple payroll needs of smaller teams.
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OnPay: Costs more but adds features like contractor payments, employee self-service, advanced reporting. Scales better as complexity increases.
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Patriot Payroll: Specifically targets startups and small business. Lower pricing tiers under $10 per month. Very lightweight and basic capabilities.
Evaluate team size, payroll complexity factors, accounting platform, and budget to determine the best payroll solution for your SMB. QuickBooks Payroll serves a wide range of small business needs, but isn't necessarily the most cost effective or full-featured option.
Conclusion & Summary
QuickBooks Payroll provides a streamlined payroll and accounting solution for SMBs by enabling easy integration between the two critical financial workflows. Key benefits include:
Key Takeaways
- Automated payroll tax calculations and filings save time and reduce errors compared to manual processes
- Real-time reporting and analytics give visibility into payroll costs alongside other financial data for better decision making
- Seamless data sync between payroll and accounting reduces double entry and discrepancies
Who It's For
QuickBooks Payroll is ideal for small businesses looking to simplify payroll and optimize accounting workflows in one integrated platform. The level of automation and seamless integration works best for SMBs with 5-100 employees.
Next Steps
Readers interested in streamlining payroll and accounting should:
- Sign up for a 30-day free trial of QuickBooks Payroll
- Integrate payroll data into QuickBooks Online Accounting
- Consult with a QuickBooks ProAdvisor to customize the solution
Streamlining payroll and accounting through integration can save SMBs time and money while enabling greater financial control and insight.
