Remain compliant with Nigeria’s fast-moving regulatory environment: Automate your payroll
By Magnus Nmonwu (http://APO.af/Ik3wAK), Regional Director for Sage (www.Sage.com/africa) in West Africa
The software is constantly updated to align with the latest tax laws and tables, so you don’t need to update your spreadsheet formulas or learn to make new manual calculations
Many business managers and entrepreneurs think of running the payroll as a simple matter—what could be hard about paying your employees the right amount of money on payday and giving them a payslip? But the Nigerian regulatory environment is becoming more complex and the payroll is at the centre of compliance.
Income tax regulations are changing and tax authorities are looking closer at whether employers are meeting their obligations. They also seek to ascertain if the right earnings are declared and whether the right taxes and statutory deductions are included in payroll calculations. It has become increasingly important to ensure that your annual returns are filed and submitted promptly and accurately to the relevant tax authorities.
Failing to comply– whether through deliberate evasion, late payment of payroll taxes or underpayment as a result of a miscalculation – is a major business risk. If you make a mistake when calculating statutory deductions such as Pay-as-You-Earn (PAYE), National Housing Fund (NHF), Pension Fund and National Health Insurance Scheme (NHIS), you will face fines and penalty interest. It may also be bad for your business’s reputation.
Because compliance is complex and the risks of non-compliance are high, Nigerian businesses are concluding that spreadsheets and other manual methods are no longer sufficient to meet their changing payroll needs. Instead, they are looking to automated solutions to keep records and do payroll calculations, which will enable them to meet all their payroll compliance requirements.
Benefits of automation
Payroll automation software—with solutions available for businesses from start-ups to mid-sized companies and larger enterprises—will take care of calculating the complex formulas for the various deductions, generating compliance reports, and keeping accurate records. That makes it easier to perform accurate calculations, file submissions on time and generate reports and electronic payslips.
Automation saves hours of manual work for the person responsible for payroll administration. It also ensures that your employees receive accurate, on-time payments and payslips, which helps keep your workforce happy.
Automation makes it easier to keep track of changes to tax regulations that impact on payroll tax calculations and various changes in legislation. The software is constantly updated to align with the latest tax laws and tables, so you don’t need to update your spreadsheet formulas or learn to make new manual calculations when changes are made or required. This reduces the risk of human error.
Payroll fraud is one of the most common white-collar crimes (http://APO.af/CmUxko) in the business world; what's more, erroneous payments can cost your business. A robust payroll solution puts tight financial controls in place. It helps to reduce these risks by giving managers better visibility into transactions, providing an audit trail, and providing a set of controls, checks and balances that help to prevent errors and fraud. It closes many of the gaps where fraud and human error can sneak in.
Nigerian business builders and entrepreneurs don’t go into business to manage admin and red tape, which is where automation makes a difference. Our vision is to make tasks such as payroll administration invisible by 2020 so that you can focus on business strategy, workplace satisfaction, customer satisfaction, and other areas of your business that give you a competitive advantage.
Distributed by APO on behalf of Sage.
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