Automating payroll administration: the process from submission to filing

From change to submitted return in five phases, with one control point per phase. Which steps can you automate and which checks do you build in?

The short answer

A payroll process that scales consists of five phases with one clear control point per phase: submission, processing changes, running and flagging, checking and releasing, filing and recording.

You automate mainly in the first three phases: submission through a fixed route, changes that reach the administration without retyping, and flagging of deviations. The release remains a human decision, because that is where someone carries responsibility for what the employer pays and what the employee receives.

The biggest time gain is not in faster processing, but in fewer corrections afterwards. Every correction costs more time than the check that would have prevented it, see Correcting a payroll tax return.

The chain in five phases

Phase 1: submission

Most corrections start here: a change that arrives too late, through another channel, or incomplete.

What works:

• One route per employer. A portal or a fixed form, not a mix of email, WhatsApp and phone calls. Loose channels produce changes nobody can trace back.
• A fixed submission date with a reminder that goes out automatically, and a second reminder with a clear consequence.
• A list of change types per employer covering the recurring ones: starters and leavers, contract changes, hours, leave, allowances, absence.
• Mandatory fields when employment starts. A new employee without complete data guarantees a correction.

What you can automate here: the invitation and the reminder, the completeness check on mandatory fields, and flagging employers who have submitted nothing while there were changes last month.

Phase 2: processing changes

Retyping is the biggest source of errors in this phase. Every change that flows straight from the submission channel into the payroll administration is one error fewer.

Two points of attention. Hours coming from another system (time registration, planning, point of sale) must line up with the payroll run period; differences in how periods are defined produce structural deviations. And a change you cannot process without asking should become a recorded question, not a mental note.

Feedback closes this phase: an overview of what you processed, so the employer can see whether their change arrived. That prevents the most common misunderstanding in payroll, namely that both parties thought the other had taken care of something.

Phase 3: running and flagging

The payroll run itself is calculation and should be fully automated. The value lies in what is flagged after the run.

The alerts that deliver most in practice:

• A net or gross difference per employee above a threshold compared with the previous period.
• Zero hours or zero pay for an employee who is still employed.
• An employee with an end date in the past still included in the run.
• A new employee without payroll tax details or without a tax table code.
• An allowance type this employer has not used before.
• A difference between calculated hours and submitted hours.
• A deviation in contributions or sector classification compared with the decision letter.

Every alert should have an action: dismissed with a reason, or resolved. An alert everyone clicks away is not a check.

Phase 4: checking and releasing

This is the point where automation stops. What a person does here:

Assess the variance analysis. The software calculates the difference, an employee judges whether the difference is explainable. A pay rise explains an increase; an unexpected drop in net pay calls for investigation.

Handle the exceptions: special payments, back pay, corrections from an earlier period, employees leaving with a final settlement.

Perform and record the release: who approved, at what moment, based on which overviews. That record belongs to the control trail, see Audit trail.

Agree who may release and what happens when that person is unavailable. Without that agreement, releasing becomes a formality in busy months.

Phase 5: filing and recording

1. Submit the payroll tax return and keep the confirmation.
2. Create the payment file and prepare the remittance.
3. Make payslips and any annual statements available to employees.
4. Post the payroll journal entry in the books.
5. Check the reconciliation: the return, the journal entry and the payment should agree.
6. Update the file: the release, the alerts with how they were handled, open questions.

Step 5 is the reconciliation you meet again in the monthly close, see Setting up the monthly close.

What you automate per phase and what you do not

Checklist per payroll run

1. All submitted changes processed or recorded as a question.
2. Starters and leavers complete, with dates and data.
3. Hours reconciled with the source.
4. Alerts handled, each with a reason.
5. Variance analysis per employee assessed.
6. New allowance types assessed for tax, see Work-related costs scheme.
7. Release performed by an authorised employee and recorded.
8. Return submitted, confirmation kept.
9. Journal entry posted and reconciled with the return and the payment.
10. Open questions carried into the next period with an owner.

What you agree with the client

Three agreements make the difference between a process that works and one that stalls every month: the submission date and channel, what happens when submission is late, and who at the employer is the point of contact for questions during the checking phase. Put those agreements on paper at the start of the engagement, not after it has gone wrong three times.

Measuring whether the process improves

Payroll has an advantage over much other firm work: the cycle is monthly, so you quickly see whether an improvement works. Four measures are enough.

Look at these figures per employer, not only as a total. Usually a large share of the repair work comes from a small number of employers, and then a conversation with those employers is more effective than a process change for everyone.

Holidays, peak periods and handover

Payroll has hard deadlines and cannot wait until someone is back. Three provisions make the process less dependent on individuals.

A work instruction per employer covering the particularities that are not visible in the system: collective agreement quirks, fixed allowances, arrangements about allowances, who approves on the employer's side.

Two authorised releasers per employer, so the release never depends on a single calendar.

Planning that allows for the peak. Around the year-end, holiday pay and collective agreement changes, volumes rise. Those are the moments when checks get skipped, so that is exactly when more time is needed rather than less.

Next step

Discuss your current payroll process with a Giroo specialist: where changes get stuck today, which alerts are missing and which steps you can automate without giving up the release.

Content reviewed: July 2026.

Related articles

• Correcting a payroll tax return: fixing errors without creating new ones
• The work-related costs scheme: checks, mistakes and a checklist for your firm
• Filing a VAT return: complete step-by-step guide for entrepreneurs

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