Outsourcing your payroll can save you time and money, not to mention keep you in compliance.
There are plenty of exciting things to take in to account when building your dream business; location, marketing, logos, that perfect floral arrangement for your front window. However, sometimes the last thing you take into account can turn out to be the most costly. Payroll is a chore; we all know this. However, if you decide that outsourcing your payroll may be the next step in growing your business, there are a few questions you need to answer before you sign that proposal.
Is payroll something I can do myself?
What is your time worth? Is the time you spend trying to figure out taxes and where to send them taking time away from you actually earning money for your business? A good payroll service will take that hassle off your hands, as well as providing a guarantee that ensures that your payments are paid on time, every time.
Can I afford to outsource?
This is one of the most common questions payroll providers get; how much do payroll services cost? It’s an important question, and the best way to look at it is the value. Not just the value of knowledge, or the value of time, but the value of a single payroll mistake. Avoid being a statistic: 40% of small businesses pay an average of $845 per year for late or incorrect filings and payments. The question that should be asked is: can I afford NOT to outsource?
What services do I need, and does the company provide them?
There are a few things a payroll company should do for you: pay your payroll taxes on time, pay your employees on time, and file your payroll tax forms online. After that, some of the services you may need include W-2 forms, direct deposit, online paystubs, as well as online timekeeping for employee tracking. Check out their software; do they have online platform that ensures the information you enter is the information getting processed, negating “pass-through” error? In addition, having the ability to pick and choose which services you need, instead of paying for those you don’t can save you hundreds (if not thousands, depending on your size) every year.
Who should I use?
The best answer: ask someone you trust. Your accountant, lawyer, local Chamber – even asking for a client list to get their opinions on the service can give you all the information you need. Call their support line; is the person answering the phone knowledgeable, or someone “reading from a script”? If there is an issue with payroll, you want to make sure you are speaking with their certified team members to fix your problem every time you call.
When you have made your choice, your payroll company should make sure they have all the information necessary to take care of their wages and any deductions they are eligible for. Keep an eye on your bank to ensure there are no drastic changes once your payroll service starts, and some businesses even continue to run their own payroll for the first few cycles just to confirm the number match up.
Finally, if you do decide to move forward with payroll outsourcing, the best time to do so is at the beginning of the year (the cycle starts with a clean slate) or at the end of every quarter (your quarterly reports are already in order). With so many options to choose from, narrowing down those results can be just as difficult as crunching numbers yourself. Make sure you use a trusted partner that will work to make sure that it will be a mutually beneficial relationship.