Payroll processing can be one of the most expensive aspects of running a small business, and one of the most frustrating. It’s also the single biggest non-revenue producing activity any business engages in. Outsourcing this process can be a good move for a business, but is also a scary one. Here’s a deeper look at the process.
Isn’t outsourcing payroll processing the same as contracting?
Outsourcing is similar to contracting, but they aren’t the same process. Outsourcing HR and payroll processing tasks is a fairly common form of business outsourcing. Contracting is simply a matter of bringing in additional workers on different contract terms from your permanent staff. Outsourcing involves handing over a critical part of the businesses necessary admin to those who have made that area one of expertise
It’s one of the best way to keep consistent payroll rates, while being assured that a company that specialises in this area and is fully congruent with all the best practices of the field is handling these sometimes tricky to navigate fields. Not only does this reduce the burden of hidden costs and errors that can unknowingly creep in when you are not operating in a field you fully understand. It also gives you a good deal of flexibility, as you can adjust the services to as much or little as you need. You are spared the need to waste money on a salary for someone only dedicated to handling these affairs, and can instead focus on the core of your business while saving money on a simple monthly payment.
What other benefits does outsourced payroll processing offer?
In addition to proving a cost effective solution for the average small business, outsourcing also allows you to focus on your business, and not the worries of administration. This means more of your time and focus can go into the strategic planning needed to keep your business running at its best.
If you’re worried that offsite payroll processing will endanger the safety and integrity of confidential data, please don’t be. Multiple layers of security and off site hosting means you will have more, not less, security for that data then you might onsite in a small business. Most will offer online portals to help you submit information easily. This outsourcing means that you will be working with people solely dedicated to HR. As the business environment gets tougher, keeping staff can be one of the most important facets of a successful enterprise. Being able to concentrate more on your staff will help with staff retention.
With outsourced payroll processing, you will also find a lot of your tax headaches significantly reduced, as these people work with the legislation daily and will have greater familiarity with what needs to be done when. This will also reduce your risk of accidental non-compliance with tax laws that can sometimes be very complicated.
Outsourcing payroll processing can help streamline your HR services and bring your tax compliance into line in a way that benefits your business.