Payroll outsourcing nowadays is no longer a business trend or an option to consider. It becomes now a requirement for small to mid-scale companies because of its unbeatable advantages. It is beneficial not only to the business owners but also to employees and to the company.
If you are still processing your employees' payroll in-house, then you are missing the company's opportunities to focus on revenue generating activities and to exponentially increase savings in expenditures. Perhaps it is about time that you need to know why more companies are now outsourcing their payroll functions.
Time Saving
Oftentimes payroll is the first accounting function that is being outsourced in any organizations because its cost is quantifiable. Also, its function is very basic which makes it easier to assign to third party.
Although the payroll tasks are basic, it has laborious workload and intensive paperwork which can consume a lot of your time. Its function is also very tedious because there are many details which need to be carefully look into. If you are a business owner with twenty staff, your time is valuable and better spent in expanding your business rather than calculating the payroll tax related and overtimes of your employees.
With outsourced payroll function that will execute all these payroll activities, you are able to focus now on important matters in your business.
Access to the Latest Payroll System and Technology
If you are a business owner of a mid-size firm, you will hesitate to shell out money to invest in a latest payroll technology. You will rather invest the money to your business operation than updating the payroll system which anyhow has an option to be done manually.
Outsourcing your payroll function gives you the opportunity to access the latest payroll system and technology in the market. Generally third party accounting services provider invest in such expensive state-of-the-art technologies to ensure accuracy and reliability in their work output.
So why spend for any payroll technology related cost when you can have free access to such system?
Less Risk
As mentioned earlier, the tasks involved in preparing the employees payroll are tedious. If you have careless payroll personnel, you will end up with angry employees and potential penalties.
However, with outsourced payroll function, this is unlikely to happen. Third party accounting services provider has always a payroll specialist assigned for this particular task. Therefore, this specialist has the full grasp of the nitty-gritty involved in the payroll process thus you can expect an accurate work output.
More so, some governments imposed fines and penalties for tax related errors made in the employees' payroll and mistakes in the annual reports. Although it depends in the terms and conditions of the contract, the account service provider can be held responsible for such carelessness.
Cost Effective
If you will dissect the expenses incurred in the payroll process, you will be surprised by the amount of your expenditure. Think about of the number of hours allotted to the payroll related tasks, the cost of preparing, printing, and distribution of salary slips and checks. On top of that, there is the mounting paper loads to file and employees' personal files to organize.
Also, there is no need to hire and train, or fire any staff because this function is already provided by the third party. You can expect the salary distribution to be on time because there will be no sick leaves and vacations. Thus, you make everyone in your business happy because of a reliable payroll service.
Indeed payroll outsourcing is undeniably beneficial to you as business owner and to your employees.