Small Business Solutions
Top 3 Reasons You Should Outsource Payroll
Owning your own small business can be a lot of work. Learn why outsourcing payroll can be a smart solution that can help you avoid added stress and give you back valuable time.
While some businesses might initially opt to handle payroll functions in-house through manual bookkeeping or do-it-yourself payroll apps, most other business owners have come to prefer the expertise of a professional payroll provider. When considering whether to outsource this function, the time and resources required to complete essential payroll tasks often weigh heavily in the decision-making process. For most small businesses, the benefits of outsourcing payroll stand in stark contrast to managing the essential task in-house. Here are the top reasons why.
SAVE TIME, INCREASE PRODUCTIVITY
No matter how many employees a business has, processing payroll demands time and attention to detail. Keeping track of benefit deductions, garnishments, new hires and terminations, and paid time off, as well as federal and state regulatory changes can be time consuming tasks for any small business. Once a business has hired its first employee, payroll responsibilities will continue every pay period. The complexities of payroll processing require a significant time commitment on a daily and weekly basis — time you can't make up elsewhere. Whether it's calculating payroll amounts, generating in-house reports, preparing and remitting state and federal payroll taxes and returns, or simply printing, signing, and distributing paychecks, the demands on your time can be costly and inefficient.
Focusing on payroll also comes at the cost to valuable time that could otherwise be spent on more pressing business priorities, such as building revenue or serving customers. By outsourcing payroll to a reputable provider like Payroll Vault, business owners have more time to focus on what matters most to them.
The direct costs of processing payroll may be significantly reduced by working with a payroll provider. If your business is on the smaller side (fewer than 30 employees), money and time can be saved by working with a trusted provider like Payroll Vault. If you consider the number of labor hours required to process payroll in-house, the costs do add up. Calculating payroll each time period, printing, signing, and distributing paychecks or pay stubs, computer software and program maintenance, training and support, keeping up with changes in tax laws, preparing and remitting payroll taxes and returns to government agencies, and other accounting responsibilities, it’s a significant and generally difficult process. And when you factor in the unpredictable variables of overtime, sick days, paid vacations, and the like, an outside payroll company can be a reliable resource that can save you money.
AVOID MISTAKES AND PENALTIES
The IRS estimates that 40 percent of small to medium-size businesses in the United States end up paying a payroll penalty each year for failing to deposit withholdings, depositing the wrong amount of withholdings, or for incorrect filing. Penalties for errors, omissions, or late payroll tax filings can be very costly. Recently, the average payroll penalty paid was $845.
Small-business owners aren’t experts in the challenging world of government tax regulations. At the same time, they are legally responsible for any cases of misrepresentation or a failure to accurately report employment taxes to federal and state government agencies. Mistakes lead to audits and penalties — situations no business wants or needs. 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. A good payroll provider will reduce the opportunity for error when compared to in-house staff.
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. Payroll Vault 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.
TRUST THE EXPERTS
Payroll Vault was founded in 2008 to be a well-rounded solution to the payroll challenges facing many small-business owners and their employees around the country. Focused on cutting-edge technology and efficiency, Payroll Vault serves as an industry leader dedicated to helping our clients succeed.
Visit us to learn more and get a quote for your business today.