A cloud-based payroll system is a software solution that allows businesses to manage their payroll processes over the internet. Instead of relying on local servers or physical software, these systems store data in the cloud, making it accessible from anywhere with an internet connection. This flexibility helps companies streamline payroll tasks, such as calculating wages, managing employee benefits, and ensuring compliance with tax regulations. These systems often come with features like automated calculations, direct deposit options, and employee self-service portals. By using a cloud-based payroll system, businesses can reduce administrative burdens, minimize errors, and improve overall efficiency in managing their workforce's compensation.