As a business owner, you probably have considered if you should outsource payroll processing. You may be asking what your business will gain.
Employers of all sizes and types will find that the answer is “a lot.” Consider these five key benefits when you outsource payroll processing.
1. Save time by outsourcing payroll
Processing payroll is time-consuming, especially if you are doing it by hand. Valuable time can be lost calculating hours, keeping track of garnishments, and calculating overtime. Finding your way through ever changing tax regulations can be frustrating. Outsourcing these functions to a payroll provider allows you to focus more time on core business functions such as taking care of your customers. You typically will only need to make contact with your outsourced payroll provider once each pay period to submit hours.
2. Save money with less overhead
While large employers can afford in-house payroll departments, small and medium sized businesses can save significantly by outsourcing their payroll processing. Calculate how many hours you or your employees are devoting to payroll related activities (payroll calculation, deductions, benefits payments, printing checks, preparing and remitting payroll taxes, etc.). Then compare that to the cost of a reliable payroll services provider and you’ll find it is much less.
3. Avoid penalties and mistakes on payroll tax filings
When there is a mistake with a payroll tax filing or a late payment, the IRS can levy hefty penalties. Payroll mistakes are not only costly, but they can anger your employees and weaken employee confidence. With frequently changing tax law, having an expert whose job it is to stay on top tax laws and regulations is invaluable. A reputable payroll service provider will calculate and file payroll taxes on your behalf. Their focus is to make sure you are always in compliance.
4. Upgraded HR technology and resources
Outsourcing payroll can give your business access to HR services and resources that you may not already have. Time tracking solutions, paid time off tracking, online access to reports for the employer and employees…these are just some of the services payroll processors frequently provide. Most payroll processors offer a human resource information system (HRIS) or other human resource library. To create and manage such a resource in house is extremely cost prohibitive.
5. Gain a team of payroll experts
Paying your employees is a highly critical function of your business. Keeping their payroll accurate, secure and timely helps to maintain a happy workforce. When you secure the services of a solid payroll service firm, they become an extension of your business. Essentially you are hiring them to be your human resource department. You should be able to reply upon them as a trusted partner and a trusted part of your business. This relationship is key.
In conclusion, payroll processing is a complex but necessary function for any business. Assistance can be found when you outsource your payroll processing to a reliable provider. The benefits to your business will have a positive impact on the bottom line.