Advantages and disadvantages to manual and computerised payroll systems

Manual Payroll Systems
Advantages Disadvantages
• Not relying on Technology. • It can result in errors.
• It is Cheaper. • It can be very Time consuming.
• Better understanding of figures. • Sheets and information can be lost.

Computerised Payroll Systems
Advantages Disadvantages
• Saves time. • Power failure.
• Can be referred back to if necessary. • Hackers.
• Larger amount of information can be processed. • A computerised system helps to reduce errors.

Payroll Definitions
Taxable Income
Taxable income is gross income made by an individual or business that is considered taxable by a state or country.
Gross Pay
This is an employees pay and can come in a number of different forms e.g. Salary, wage, overtime, bonus and commission.
Net pay
The amount of an employee’s gross pays after deductions, such as taxes and pension contributions.
Salary
Wages received on a regular basis, usually weekly or monthly. Sometimes the term is used to include other benefits, including insurance and a pension contibution.
Statutory deductions
This is the amount of money taken from an employee’s gross pay over which is paid to the government. e.g. PRSI and Universal Social Charge
Non statutory deductions
This is the amount of money taken from an employee’s net pay after tax and PRSI has been deducted. It is voluntary deductions e.g. trade union dues, health insurance and company loans.

Public sector employee
A public sector employee is a person employed by the government e.g. Teachers, Nurses and The Garda Siochana.
Private sector employee
This refers to one who works in any non-government employment an e.g.accountants, mechanics and shop workers
Superannuation/pension
A superannuation pension is a type of pension plan that provides some sort of ongoing payment to the pensioner after retirement.
Tax credits
Tax credits reduce the amount of Irish income tax that a taxpayer pays in a given year. A few tax credits are granted automatically, while others can be claimed, either by simple notification to Revenue, or by completing a form.
Tax bands
This refers to the standard rate band for each individual’s circumstances e.g. standard rate band for a single person or widowed person is €32,800
Standard rate cut off point
Tax is charged as a percentage of your income. The percentage that you pay depends on the amount of your income. The first part of your income, up to a certain amount, is taxed at 20%. This is known as the standard rate of tax and the amount that it applies to is known as the standard rate tax band. The remainder of your income is taxed at the higher rate of tax, 41%.
There are no changes to tax rates or standard cut-off points in 2014. 2010 2011, 2012, 2013 and 2014 20% 41% 20% 41%
Single person €36,400 Balance €32,800 Balance
Married couple/civil partners, one income €45,400 Balance €41,800 Balance
Married couple/civil partners, two incomes Up to €72,800
(increase limited to the amount of the second income) Balance Up to €65,600
(increase limited to the amount of the second income - see example below) Balance
One parent family €40,400 Balance €36,800 Balance