Payroll definition

In basic terms, payroll involves the financial aspect of dealing with employees including salary, employee benefits, wages, salary sacrifice and deductions. The payroll department (or external supplier is payroll is outsourced) is responsible for ensuring that all employees are paid on time and receive expenses repayment on time.

Payroll has a big impact on company income, particularly as the organisation grows. Because of this there’s often tight regulation over how and when payroll is processed.

In the UK, payroll guidelines and best-practice are issued by HMRC. The complexity of processing payroll often leads companies to outsource this function to external suppliers.


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