The Advantages of Professional Payroll Services

Just like hiring an accountant to do your yearly taxes or monthly bookkeeping,  outsourcing your payroll responsibilities can save a small business owner lots of time and money!  By taking a time-consuming chore off your plate, it frees you to focus on all the other aspects of running your business. Here are just some of the reasons to consider having a professional do your payroll.

The Advantages of Outsourcing Payroll Services

Writing checks, keeping accurate records, calculating and paying payroll taxes, and communicating with your employees can be very demanding and costly, especially if you are a small business owner. Outsourcing your payroll services can reduce cost, save time, and make sure that your taxes are correctly calculated. Managing a company’s payroll is considered a big hassle even by the most experienced professionals. Outsourcing payroll is a great alternative to in-house processing and can even help you save money in the long run.

Truth be told, for very small businesses it is actually recommended that they process the payroll themselves. But, if you are a small business owner, you should take into consideration the time needed and the cost associated with in-house payroll management. Without good knowledge of the process and without access to specialized payroll software, it is very easy to make costly mistakes. For example, employees, as well as tax agencies, have to be paid on time and in full, or your business will have to pay penalties.

When to Outsource Payroll Services
Processing your company’s payroll in-house requires at least the purchase of a computer, the payroll software and the training required in order to use it. Keeping up to date on changes in personnel, salaries, or tax requirements can prove to be a real hassle, so the person or team that handles your payroll must be highly trained and professional.

If your payroll expenses are fairly stable, in-house payroll management can be done without a lot of effort. But if your payroll changes on each pay period, or if you have a lot of employees that don’t work a set amount of hours each week, then outsourcing your payroll services might be the better choice.

Benefits of Outsourcing
Payroll companies normally handle calculating each employee’s salary and taxes, printing and delivering paychecks, and supplying management reports. Additional services that a payroll company may offer are: automatic check signatures, direct deposit of checks, or issuing W-2 forms. Hiring a payroll management company can have many benefits that will make running your business a lot easier. Here are the most important:

• Save time – Hiring a professional payroll company will free up time and employees, allowing the more important areas of your organization to benefit. Processing payroll, writing and delivering checks, calculating and paying employment taxes, preparing and delivering tax forms, and handling payroll inquiries are all very important parts of running a business, but your employees’ time can be spent more effectively by improving customer service, finding more business, or releasing a new product line.
• Reduce costs – You must not underestimate the cost of in-house payroll processing. The time and resources spent on internal payroll management must be taken into consideration when you consider hiring a payroll company. In most cases, business owners find that, by employing a professional payroll service company, they will save money that can be used to improve other sides of their business.
• Avoid IRS penalties – The IRS estimates that over 40 percent of small businesses in the United States pay penalties of over $800 per year. These penalties are the result of late or incorrect filing and payments. Besides being a hassle, calculating and filing payroll taxes can attract fairly large penalties if done incorrectly. Most payroll companies offer the guarantee that you won’t have to pay any penalties if you use their services. Plus, by using a payroll service, you are also guaranteed that the tax paperwork is completed and filed on time.

In Conclusion
Whether your business needs to outsource payroll services or not depends on many individual factors, and you should carefully analyze all the data before deciding to hire a professional or do your own in-house payroll management. Always exercise caution before hiring a payroll company. They will be handling a very important part of your business, so a high level of professionalism and customer service is very important. Finding and hiring a good payroll services provider will save you and your employees a lot of time and even money, allowing you to concentrate on more important parts of your business.

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