Many small businesses are unaware of why outsourcing to a payroll service provider can be beneficial and provide cost saving to them.
Here are the top 8 reasons why outsourcing to a payroll company is your best choice.
1. Reduce Cost and Risk
The direct cost of processing payroll can be greatly reduced. It often saves full headcount and reduces the hassle and risk by having another company be the employer of record.
2. Improving Company Focus
Payroll processing is time-consuming. By working with a payroll service provider, they can take on that role while the staff can focus on other important values to the company such as generating more revenue and improving marketing efforts.
3. Avoid Mistakes and Penalties
Around 40 percent of small businesses pay on average $845 in IRS penalties a year. To ensure your payroll taxes and services are implemented correctly, outsourcing your payroll to a company that understands how to properly classify and avoid these penalties will save you greatly.
4. Reduce Payroll Burden
Payroll, in general, can be a pain if not done properly. By working with payroll services, you can cut the burden caused on a company.
5. Offer Direct Deposit
Many payroll services will offer direct deposit options. This increases employee satisfaction and gives the employee the convenience of not having to go to the bank after every paycheck. Direct deposit services also allow for less error to occur.
Each year, technology is changing and keeping up to date with this can be a major headache. If your company does not stay up to date, this may result in more penalties and errors in invoices. The majority of payroll service providers are up to date with all technologies and make payroll a smooth process.
7. Regulation Changes
Regulations, rates and government forms are constantly changing. A payroll service can help you keep up to date with the constant changes and government mandates which, in the end, will allow you to avoid more cost and/or penalties.
8. Payroll Knowledge Risk
Most small business will have one bookkeeper or controller that does all the payroll processing. However, if that person were to leave or quit, it could open your company to a lot of risk.