Specialized Payroll Services in the Philippines

Payroll and Payroll Outsourcing FAQs

What Is Payroll?

Payroll is an encompassing term that describes various aspects related to the process of compensating company employees for their work within a particular period. It may pertain to (a) the business or department (i.e., Payroll Department) charged with processing and managing payroll, (b) the actual process during which employee wages and salaries are calculated and paid, (c) the list of company employees and the wages and salaries payable to each of them, and (d) the total amount of wages and salaries paid to a company employee.

What Are the Components of an Employee’s Monthly Payroll?

A regular monthly payroll usually contains the basic monthly salary (taxable), ad hoc items (e.g., overtime, holiday, and night differential pays), allowances and de minimis benefits (non-taxable), basic salary deductions (e.g., for absences, tardiness, and holidays), statutory contributions, loan payments, and tax deductions.

Why Is Payroll Crucial in Business Operations?

Payroll is crucial for companies and businesses that employ people, as it has a direct impact on company reputation, legal compliance, talent retention and employee turnover, financial integrity, and employee engagement, morale, and productivity. 

What Are the Payroll Processing Methods?

Payroll processing may be done manually or electronically with payroll software. It may also be outsourced to a reliable payroll service provider, i.e., like FilePino, an external organization or firm that may handle either part of the entire payroll operations of a company. 

What Are the Benefits of Outsourcing Payroll?

While there are many benefits of using in-house payroll software, there are also disadvantages and limitations that provide justifications for outsourcing payroll. The benefits of outsourcing include cost and time savings, increased efficiency, expert and professional payroll team, tax and statutory compliances, enhanced data security, scalability, employee satisfaction, and human touch and real interaction, among others.

Our Outsourced Payroll Services

Payroll Calculation

We calculate individual employees’ gross pays, net pays, and deductions, including withholding taxes and statutory contributions, on a monthly or semi-monthly basis, pro-rata 13th month pays, and final pays of resigned employees based on the timekeeping summaries and other documents provided by the client. 

Statutory Compliances

We prepare, generate, file, and pay for the necessary compliances with the social security and statutory agencies, i.e., Social Security System (SSS), Philippine Health Insurance Corporation (PhilHealth), and Pag-IBIG Fund (HDMF). These include the contribution and loan reports, employment reports, etc. 

Payroll Document Generation

After payroll calculation, we generate payroll documents, including but not limited to payroll summaries, statutory contribution summaries, statutory loan reports, and customized payslips, and then send them to the clients. The actual distribution of payslips shall be under the clients’ responsibility. 

BIR Form 1601-C Details Preparation

We also prepare the details for the BIR Form 1601-C, which pertains to the Monthly Remittance Return of Income Taxes Withheld on Compensation. It is the tax return used in reporting and remitting the taxes applicable to employees of a registered taxpayer who is also an employer.

Other Value-Added Services (Package-Based)

Depending on the package availed by the client, other payroll-related services include encoding of alphalist schedules, generating BIR 2316 of the individual employees, BIR substituted filing, annualization of income and taxes, and other year-end compliances.