While the concept of the payroll process is simple, the reality of putting it into practice can be challenging. You need to create a process that delivers a positive experience for employees while also ensuring your business remains compliant with the relevant regulations. In this guide, we’ll provide you with a few valuable tips and tricks to streamline your payroll process for 2025 and keep unnecessary costs down.

Outsource your payroll to a professional

Payroll is such an essential part of running your business, but it can be time-consuming and complex. Outsourcing your payroll tasks to a qualified business can save you significant time and money, ensuring your company is fully compliant with the latest legislations and minimising the burden placed on your accounting team. From expense reimbursements to tax reporting and everything in between, you can ensure these tasks are completed completely stress-free.

Pencil in important dates and deadlines

One of the benefits of managing payroll is that you’ll know the necessary deadlines in advance, so make sure that these are pencilled into your calendar at the start of the year so you don’t accidentally miss an important date or make a scheduling mistake. These aren’t limited to paydays for your business, but also deadlines for filing P11Ds or National Insurance and Employment Allowance Changes. It’s also important to schedule in any seasonal dates when banks may be closed.

Establish a payroll calendar

In addition to industry-wide dates, you also need to set a clear payroll calendar internally too. A monthly payroll doesn’t need to start on the first of the month if that doesn’t work for your business.

In fact, it’s recommended that you set your payroll end-date a few days before the pay date which will give you enough buffer time for processing, and also makes the process smoother for employees who work variable hours as these will need to be calculated separately.

Maintain accurate records

It’s essential that you maintain not just accurate employee records but comprehensive details. In addition to personal data such as names, addresses and National Insurance numbers, you also need to keep track of benefits information, salary agreements and bonuses, and tax details. If there are any changes in employment status, hours worked or tax circumstances, make sure these are maintained and not just overwritten.

Make sure you’re handling statutory payments correctly

Statutory payments like statutory sick pay (SSP), maternity and paternity pay (SMP and SPP respectively) and other benefits that your employees are entitled to need to be actioned promptly. Depending on the contracts they have with your business, you might be required to fund paid leave and retirement benefits too. Make sure that these payments are made in a timely manner and that ongoing records are kept for any and all statutory payments the company makes.

Avoid paper payslips

Payslips don’t just show the salary information—there’s a lot of highly sensitive and confidential data that could cause disaster if it fell into the wrong hands. So, distribution needs to be handled with care.

It’s best to stick to electronic payslips to minimise the risk of this data being misused, but make sure that all documents are password protected to prevent cyber threats and ensure that only the intended employee can see what’s written on their payslip. Sending these files directly from payroll software is a faster way to send out the details to each member of staff and it will make the whole process more secure too.

Keep clear audit trails

One way to protect your company and its reputation is to use audit trails, if your software offers this option. Audit trails connect each transaction to its relevant information, such as invoices or purchase orders, which makes sure that all your payments are accurate and validated. It helps to quickly flag up any unusual payments coming in or out of the business accounts, which protects against potential fraud, and provides a comprehensive overview of the health of the company’s finances.

Keep up to date with legislative changes

Payroll legislation changes regularly, so as a business, you need to be fully up to date on the latest rules at all times. There are several ways to achieve this. First, attend payroll seminars, webinars and industry conferences which will provide you with industry best practices and information on the latest techniques and software to enhance your knowledge. Your payroll software can also be a valuable resource for the latest advice and guidance, in addition to HMRC which will always provide news of the latest regulations.

For any business, keeping a smooth and streamlined payroll process is critical. You need to ensure you’re staying compliant with the regulations and forward planning to keep your company on the right track. Hopefully these tips and tricks will help you develop a comprehensive and easy-to-manage payroll system that considers legislation, tax administration, and your employees.

Author: Chloe Miller

As a digital content writer my focus is creating impactful marketing, business, and HR content that delivers results. As a member of the Edinburgh Chamber of Commerce, I’m eager to help fellow members elevate their content strategy. I offer a range of services to meet your specific needs, from fresh website copy and engaging social media posts to impactful internal communications. Contact me today to discuss how I can help your business thrive.