About 40% of Payroll Administrators Report Anxiety Over Legal Compliance; 67% See Value in Outsourcing Services

The Reality of Handling Legal Compliance in Payroll

With annual changes to tax systems and social insurance regulations, such as the revision of non-taxable commuting allowances in April 2026, HR and payroll departments are frequently tasked with system adjustments and rule revisions. Professionals often perform daily duties while worried about whether they correctly understand the new regulations or if they might make calculation errors.

In response, NEXER and MHC Triple Win conducted a survey on "Anxiety and Countermeasures for Legal Compliance" among 55 men and women nationwide who have experience in corporate payroll and HR tasks.

### 40.0% Reported Feeling "Anxious" About Legal Compliance

When asked if they had ever felt anxious about handling legal changes, 40.0% answered "Yes," while 60.0% answered "No." This indicates that legal compliance is a significant burden for many payroll administrators.

### 59.1% Cite "Difficulty in Correct Interpretation" as the Reason for Anxiety

For those who reported anxiety, the most common reason was "lack of understanding of the correct interpretation" at 59.1%.

This was followed by "fear of calculation errors" (54.5%), "delay in receiving information" (36.4%), "anxiety over system settings" (18.2%), and "lack of time due to understaffing" and "anxiety over the impact on year-end tax adjustments" (13.6% each).

Handling legal changes requires not only grasping new information but also correctly determining how to reflect it in the company's specific payroll rules. Since payroll directly affects employee pay and deductions, even minor misunderstandings or configuration errors can lead to serious issues, forcing administrators to act with extreme caution.

### 27.3% Identified "Fixed-Amount Tax Cuts" as the Most Challenging Recent Regulatory Change

When asked about the most challenging recent legal or system change, 27.3% cited "fixed-amount tax cuts."

This was followed by "My Number system compliance" and "changes related to income and resident taxes" (18.2% each), "mandatory electronic filing" (14.5%), "expansion of social insurance coverage" (10.9%), and "revision of minimum wage" (9.1%).

Implemented in June 2024, the fixed-amount tax cut had a major impact on payroll operations. The results highlight the struggles practitioners faced in completing numerous tasks—such as performing deduction calculations tailored to each individual and updating payroll statement formats—in a short period.