Running a business is hard enough without getting bogged down with administrative tasks. Many small business owners and their staff find it a better use of their time to focus on activities related to the core mission and leave finances and payroll to someone else.
The direct costs of processing payroll can be greatly reduced by working with a payroll provider. Big businesses can afford to maintain robust payroll departments. However, Small/medium sized businesses, having an in-house payroll process is a money burner. If your business has fewer than 50 employees, you can save money by outsourcing your payroll operations. Let us guide you through a cost benefit analysis to show you what the savings can be.
Avoid IRS penalties / Mistakes
The IRS states, 40 percent of small businesses pay an average penalty of $845 per year for late or incorrect filings and payments. Penalties for errors, omissions or late payroll tax filings can be very costly. Government rules and regulations are always changing and business owners can’t be expected to stay on top of these changes. Professional payroll providers, on the other hand, must stay current with rules, regulations and changes in tax rates. Many outsourced payroll providers calculate payroll taxes, manage filings and payments and will assume the cost of penalties due to incorrect calculations or late payments so long as you provide the necessary information and funds on time. Keeping abreast of state, federal, local and industry-specific regulation changes is a real challenge. A reputable outsourced payroll provider has a staff dedicated to keeping up to date on all of the changes that could affect your payroll, ensuring that you stay in compliance.
Team of Experts
Most business owners and payroll related staff don’t have time to research and study constantly changing regulations, withholding rates, and government forms. By outsourcing payroll, a small business can take advantage of expertise that was previously available only to big companies. Make sure you engage a qualified team of experts who can administer all the aspects of your HR and payroll needs.
Technology Advancement costs
A constant question for small business owners is whether they have the latest version of their payroll software and the most recent tax tables installed on their computer. Using the wrong tax tables can result in stiff penalties. Paying a maintenance fee and having to upgrade software is a fixed cost ongoing. Outsourcing payroll removes those costs / headaches and keeps payroll running smoothly.
Providing direct deposit to employees is difficult if a company doesn’t use an outside payroll service. Increasingly, small businesses recognize that employees want direct deposit. Using direct deposit reduces the risk of fraud by eliminating the use of paper checks that could be altered or counterfeited. Unlike a paper check that bears your account number for all to see, when you use direct deposit your account number remains confidential to your financial institution or payroll provider.
Peace of MindWith the help of a professional payroll service provider, the hassle and pain often associated with processing payroll is gone. You provide the basic information, and your payroll company takes care of the rest. And with guarantees of error-free payroll and tax filings and payments, you can eliminate the worry that many experience when it comes to paying employees and taxes correctly and on time. There’s a lot to be said for the peace of mind that outsourcing payroll services can bring to a business owner or manager. No headaches, no hassles: You’re left to focus on running a profitable business. A clear focused mind is one of the true benefits of outsourcing payroll.
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