Month-end billing day
At the end of the month someone sits down to invoice every payroll client. For each, they count payslips across the weekly or monthly runs, add starters and leavers, remember the off-cycle payment done for a bonus, the P45 reissued, the extra report the client asked for. Some of this is in the payroll software, some in emails, some in the administrator's head.
It takes a day or more. Some extras are missed. Some clients are billed on last month's headcount because that was easier. Nobody is confident the invoices are complete.
Why bureau billing is hard to get right
The chargeable events happen throughout the month across many clients and many people. Payslip counts live in the payroll software, extras live in emails and task lists, and fee terms live in contracts. Billing needs all three, and they are combined by hand once a month.
Terms also vary by client: some pay per payslip, some a fixed fee up to a headcount, some are charged for starters and leavers, some are not. Applying the right terms to the right counts is a job that invites mistakes.
What manual billing costs
Missed extras are lost income. Billing on old headcounts undercharges growing clients. Invoices that are occasionally wrong generate queries and credit notes, which cost more time. And the person doing billing is often a senior administrator whose day would be better spent on payroll.
| Chargeable item | Where it is recorded today |
|---|---|
| Payslips per run | Payroll software |
| Starters and leavers | Payroll software, sometimes |
| Off-cycle or supplementary runs | Administrator's memory |
| Ad hoc reports and letters | Emails |
| Year-end extras such as P11D | Separate task lists |
How we build payroll bureau billing
- Each client's fee terms are set up once: rates per payslip by frequency, fixed fees and bands, charges for starters, leavers and extras, and any minimum.
- At the end of each billing period, counts are read from your payroll software for every client: payslips per run, starters, leavers and supplementary runs.
- Extras are captured as they happen, from a quick 'log a chargeable item' button in your task tool or email, so they are not left to memory.
- Draft invoices are created in Xero, QuickBooks or your practice billing tool through its API, with lines that show the counts and rates.
- A reviewer sees all drafts in one list, with changes against last month highlighted, and approves them in bulk or one by one.
- Where you collect by direct debit, approved invoices go into your usual collection run.
The first months run in parallel with your current billing, so you can see the differences before switching over.
Headcount bands deserve a special mention. Many bureaus charge a fixed fee up to a number of employees and then more above it. The billing check flags clients who have crossed a band, and clients who have dropped below one, so the fee moves in both directions and nobody can say you only ever notice when it suits you.
Billing that takes an hour, not a day
Invoices reflect what was actually done, including the extras that used to slip. Growing clients are billed for their growth. Clients get invoices with clear lines they can check, which reduces queries. And the senior administrator who used to lose a day to billing spends it on payroll again.
Is your billing leaking?
- Billing day means counting payslips client by client.
- Extras are billed only if someone remembers them.
- Some clients are billed on an old headcount.
- Credit notes for billing mistakes are common.
- Fee terms are different for many clients and kept in contracts.