Are you managing payroll and remaining compliant?

Accountants are often juggling multiple responsibilities when working with clients. For those working in-house, in finance teams or departments, it might well be that payroll has simply fallen within their remit, and so accountants who are less familiar with the nuances of payroll find themselves tasked with completing this very important task. While there’s no doubt that accountants are experts in finance, payroll can pose new challenges.

The payroll landscape is one of regular change, and the consequences of compliance risks can be adverse. The payroll department must ensure an employer’s statutory and contractual obligations are fulfilled. The Chartered Institute of Payroll Professionals (CIPP) helps organisations create robust processes and offers compliance checks which are critical to ensuring non-compliance risks are eradicated.

Maintaining best practice in payroll is essential to remain compliant but with constant changes, it could be easy to fall behind if individuals and departments don’t keep their knowledge and processes up to date. The penalties if businesses fail to pay employees correctly and on time, report tax and National Insurance incorrectly or where incomplete payroll records are held can include significant financial penalties enforced by HM Revenue and Customs (HMRC), damaged reputation from negative media coverage and even the loss of staff. Many errors can be found in areas perceived by those who aren’t working in the payroll industry as being straightforward, such as national minimum wage (NMW). The Department for Business and Trade (DBT) publishes lists of businesses that haven’t met their NMW obligations and so have paid their staff incorrectly, which highlights just how severe the reputational consequences can be where payroll isn’t processed compliantly.

Given the critical nature of payroll compliance and the risks associated with non-compliance, the training and educational element of the CIPP’s work is vital.

Teams of dedicated individuals deliver the right pay at the right time to millions of workers each pay period, contributing billions of pounds to the economy each year but also playing a huge role in the overall success of companies. For accountants, who may not be payroll specialists, but find it forming part of their work, understanding how to achieve  full payroll compliance may not be an obvious task.

The CIPP’s team are experts in helping to ensure payroll compliance, offering a consultancy service which acts as a ‘fresh pair of eyes’ to examine any areas where further help may be required. Whether you’re a large business that’s undergone a complicated merger or an SME that wants to ensure your small payroll team is operating correctly, the CIPP provides payroll, reward, benefits and human resource advice, which is completely independent of all software and service suppliers and draws on its own knowledge base.

Natasha Taylor, Consultancy Relationship Lead at CIPP Consult; “Compliance within payroll is essential, yet payroll departments are often so focused on making sure all employees are paid on time and accurately that they don’t always have time to step back and review the way they operate. This can be especially true of small finance teams, where the person processing payroll isn’t necessarily a dedicated payroll specialist.

“Sometimes, the department is aware something needs to be investigated, but finding the time, resource or expertise to effectively review and identify any issues becomes a barrier. The CIPP is on hand to help with these issues, helping business owners get clarity on their payroll processes.”

For more information visit www.cipp.co.uk/consult.

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