One of the biggest decisions facing many business owners is whether to outsource certain functions that aren’t part of core business activities. One of the most obvious of these functions is a company’s payroll. For this reason, payroll management services could be the best option.
Managing payroll in-house has become a burden that many firms could do without. Constantly changing legislation and tax laws, understanding holiday pay, sick leave, maternity pay, all these factors need keeping on top off. It is a time-consuming and costly, and frequently frustrating exercise.
Then there’s the software. Payroll software is expensive, needs constant updating, and is prone to crashing at exactly the wrong moment!
All good reasons for employing a Payroll Management service. In this article, We detail all the benefits of outsourcing your payroll.
1. Save time
Time is money, and one thing that payroll swallows up is time. There is no putting payroll off for a few days; it has to run every month or week regardless of how busy you are.
But the running of the payroll is just one aspect; the task is ongoing. Monitoring staff hours, sick pay, new hires, holiday pay, software updates, the list is endless. Each year hundreds if not thousands of hours are lost to payroll duties.
Outsourcing payroll management frees up the majority of your time and lets your staff concentrate on more productive aspects of your business.
2. Reduced costs
When compared to the costs of the in-house payroll, outsourcing can end up reducing your overheads.
Without even factoring in items like hardware and IT technicians that come around every time your software updates go awry (and they do!), outsourcing your payroll can save money.
It is surprising for many entrepreneurs when they discover just how much in-house payroll costs them. Employee hours, software licenses, printing costs, and training are all core payroll costs that add up to more than you’d expect.
Outsourcing to a specialist company is a cost-effective payroll solution.
3. Privacy and Security
Let’s face it, most offices are hotbeds of gossip; it’s just human nature. Even if you have trustworthy staff that are the soul of discretion, they can accidentally let slip the details of someone’s pay, and this can be problematic, to say the least! Outsourcing removes the possibility of such leaks.
Security is also an issue that can cause much stress. Payroll requires high levels of data security – Vulnerabilities include:
- Data theft
- Identity theft
- Data loss
Even when things are running smoothly, the constant worry of these vulnerabilities can be bad enough. Companies that offer payroll management services understand the intricacies and procedures of keeping your payroll secure from hacking and safely backed up.
4. Benefit from experts in the field
Small businesses often use the jack-of-all-trades approach. Running the payroll might just be one of a multitude of tasks assigned to an employee; it isn’t realistic to think that they will have all the necessary expertise to do this efficiently.
Constant research and study are required to keep abreast of constantly changing tax codes and all the other vagaries of payroll management. It is even possible that you are paying over the odds for employee contributions.
Switching to an outsourced payroll service means employing the services of experts in the field. When you outsource, your payroll is run by people who have a deep understanding of the subject, they know the tax laws inside out, they understand every aspect of payroll management.
5. Greater control over costs
Controlling costs is essential for any business aiming for success. Fewer costs mean greater profits, and switching to an outsourced payroll is a great way of reducing costs.
Managed payroll services are flexible and change as your business changes. For instance, if you employ a payroll clerk and your business takes a downturn and needs to reduce staff, your payroll costs will remain more or less the same.
Consider the same scenario using a managed payroll service. In this instance, your payroll costs shrink as you reduce staff numbers. Business on the up, no problem, and no need to hire extra staff to help out with payroll. Payroll management services scale with your business.
Software costs can also be included in this category. Constant updates cost money, as does the need to replace outdated computers when the latest update tells you that your PC doesn’t meet the minimum requirements anymore.
6. Greater accuracy
It is all too easy to fall afoul of the taxman, and that isn’t a pleasant experience. As already noted, payroll can be a minefield. Varying tax rates, constantly changing employee laws, understanding benefits, different pay scales – the task of maintaining an accurate payroll is daunting, to say the least!
By investing in managed payroll services, you take away the stress from all this and avoid those dreaded words – the taxman cometh! Of course, it also keeps your staff happy too. Making sure your staff are accurately paid helps ensure greater morale by letting them know you are invested in their welfare.
7. Information at your fingertips
Knowing your payroll commitment is essential. Payroll software can be cumbersome when it comes to producing relevant reports.
Payroll management services provide you with all the current information you need to know exactly how your payroll stands without trying to figure out how to extract the information from unintuitive software.
8. Peace of mind
Last but not least is the peace of mind you get from knowing that all the hassles detailed above are someone else’s problem. A payroll management service is more than just a business tool; it’s a tool that can help you sleep peacefully at night.
Payroll management services eliminate the worry that many employers experience when it comes to payroll. No more worrying if your employees will be paid on time, or that the bank transfer system is working, or even if your tax calculations are correct. Moving to an outsourced payroll system can alleviate many of the day-to-day hassles and headaches of the human resource side of your business. Letting you concentrate more on the actual running of a successful business!