What is Cloud Payroll and How Can It Benefit Your Business?

Payroll is just one of the ways the cloud can transform your company, and there is no reason for you to skip switching to cloud payroll.

Human resource management is one of the biggest and most faceted departments in an office. Just because you have a small company does not mean that you are exempt from the enormous and tough responsibility of ensuring robust HR functions.

One of the most significant aspects of HR to your employees (at least most of the time) is payroll, which has fortunately been included in the long list of services that is being revolutionized by cloud computing.

Some background about cloud payroll

“Cloud” is a collective abstract term that refers to servers that store programs and data and are accessed remotely using any device that is connected to the Internet. With cloud payroll, you can process timesheets, issue payments, calculate tax info and deductions, and more.

Nowadays, large companies are racing to switch their payroll systems over to the cloud to minimize costs, increase efficiency, and strengthen their core competencies against those of their competitors.

Needless to say, major firms can afford to switch easily because they have the funds. Moreover, their large numbers of employees make the cost of moving to cloud-based payroll reasonable and feasible.

By contrast, you may be hesitant to give cloud payroll a try because the cost may be too exorbitant relative to the small number of workers you have. Furthermore, applying a change so drastic is always scary.

However, as with many other technological advances, the cloud comes in all sizes. There are now plenty of service providers and vendors who offer cloud payroll solutions to small and medium businesses. It is not merely a matter of welcoming this technological milestone and understanding the advantages it can give you and your company.

Benefits of Cloud Payroll


In-house payroll systems need to be upgraded every once in a while to adjust to company growth, system updates, changes in legislation, and trends in business activity. Sometimes, you need to purchase new hardware as well.

A cloud-based payroll system automatically adjusts to you. This capability of the cloud system makes cloud payroll ideal especially if your organization has seasonal business patterns or is rapidly growing.

Cost Reduction

One of the most significant advantages of using cloud payroll (or anything else that is stored in the cloud) is its relatively lower cost in comparison with having a traditional payroll system.

When your payroll is based in the cloud, you can continue your operation seamlessly and easily as the cloud takes care of most of your payroll work for you. You do not need to buy expensive equipment, devices, software packages, and paper checks, among others.

Error and Penalty Avoidance

Cloud computing will always be smarter than a poor overworked individual working extra hours to meet the payroll cutoff. The system is certainly not infallible. However, the margin of error of cloud payroll is much smaller than that of manually handled in-house payroll systems.

In addition, cloud payroll systems are tested, reviewed, and evaluated for possible bugs and other issues. We are talking hundreds, possibly even thousands, of users, developers, and business owners who are checking the system. Errors are automatically rectified.

By contrast, you may not even have an employee assigned to review payroll information and deductions. Chances are, you may have already overlooked a considerable amount of information or calculation but remain unaware of them.

Such errors have brought large firms out of business, which means that yours is by no means an exception. Mistakes like these can cost you a couple of hundreds in fines at least.

Enhanced Security

Payroll data and supporting documents are critical and have to be maintained for a certain number of years. If your servers and paperwork are all on site and not backed up to the cloud, any natural disaster can wipe them all out easily.

Cloud payroll not only frees up storage space in your office but also secures all relevant data. No matter what happens at your physical location, a simple login to the cloud can restore whatever is lost.


In manually operated systems, payroll issues strictly have to be dealt with in the office. Whenever you recall something that needs checking, you have to go to your workplace, log in from one of the archaic computers in the HR office, and look at or print out the necessary documents.

When you have a cloud payroll system, you (or whoever is in charge of payroll in your team) can easily log in and find the information needed from the cloud provided that you have Internet connection.

Some systems even have mobile functionalities and allow you to access your payroll platform via an optimized interface. You can perform all payroll-related tasks, ranging from the routine to emergency, regardless of whether you are physically in the office or vacationing in the Maldives.

Employee Satisfaction

Over the years, workers have developed a predominant impression and set of expectations of small businesses. Somehow, these employees have come to accept that working for small firms means payroll issues from time to time.

However, this is an outdated notion, and you should make it your goal to erase this thought from your employees’ minds. Using a cloud-based payroll system leads to increased employee satisfaction because, provided that the funds are sufficient, their pay is issued promptly and calculations are always precise.


Face it. You are a business owner and not a data entry professional or an HR practitioner. Besides, you are more likely to commit errors when you are forced to do something you do not enjoy.

You should be on the floor, ensuring that all employees and equipment are working. Leave the numbers and paperwork to the cloud because those are what it does best.


The cloud is revolutionizing nearly every aspect of business. This technological marvel is sweeping all industries to a much faster, smarter, and more efficient business environment.

Payroll is just one of the ways the cloud can transform your company, and there is no reason for you to skip switching to cloud payroll.

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