Benefits of Not Doing Your Own Payroll

Benefits of Not Doing Your Own Payroll

| 3 min read

As a small business owner, figuring out ways to save on expenses is a constant battle. There are some ways this works and others that don't. Do-it-yourself payroll is one place you might want to avoid cutting costs.

In the old days, the owner could simply grab some cash from the drawer and pay employees. Some small businesses just write a check and assume the payroll is all done! But payroll is more than just keeping track of hours and pay rates. Today's business owner needs to understand federal tax deductions, but it is more than just knowing how to calculate taxes.

Local, state, and federal taxes, compliance with changing laws and percentages, unemployment taxes, and more are all part of the equation that makes in-house payroll complicated and specialized.

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Outsourcing Payroll Advantages

Hiring a dedicated accountant is expensive when you add up salary, benefits, and taxes. It is often not necessary. This is where outsourcing becomes a great option. Advantages you will experience with outsourcing include:

  • Outsourcing saves time. Business owners need to concentrate on all of the other aspects of running a company, from everyday operations to surprise problems that crop up. When you outsource, there is very little work involved for the employer. Doing the payroll on your own means calculating hours, overtime, taxes, 401(k) contributions, tax filing, printing checks, and other details. Many wage garnishments are court mandated and require extensive records. Outsourcing takes you out of the business of managing these types of payroll deductions.
  • Confidence in the timeliness and accuracy of your payroll is essential. When you outsource payroll, you can rest assured that everyone is paid on time and there are no errors. Correcting the payroll costs you time and tax mistakes can lead to costly fees by the IRS. Paying employees on time and accurately also means they have more confidence in your abilities and the stability of the company.
  • Filing taxes by deadlines and ensuring that the amount you pay is correct keeps your small business compliant. Using a service to perform these tasks also means that new tax laws, changes in tax brackets, and calculations are up to date with constantly changing situations.
  • Keeping an employee's personal information safe is also part of your payroll system. Reliable outsourcing companies provide internet security, so you don't have to worry about data leaks or other employees looking at pay rates or other personal information.
  • Offering direct deposit is not only a convenience for your employees, but it also means you don't have to pay for expensive checks or wait for the checks to clear before doing banking reconciliations. Many banks also charge for the number of checks you write so you may save money on your account fees.
  • Reports are more accessible for situations where you need to see the payroll expenses. Budgeting and forecasting require the use of all expenses and income, so having a regular payroll deduction is vital to these functions.
  • Using a payroll company eliminates worries and concerns over late or erroneous payments. Allowing someone else to take this responsibility means you can focus on other aspects of your business.

Companies to Outsource To:

First off, most companies will do just fine getting payroll out. When we are gathering which of the companies are the best, we're talking about which syncs to QuickBooks the easiest, meaning less work for you, as well as which adds the most value for the cheapest amount.

Gusto

We outsource all of our clients to Gusto. We've found them to be the most valuable bang for the buck of the companies that we work with. Track all time and attendance, maximize your tax credits, project what your workforce may cost in the future, as well as get people paid on time! An advantage to your employees as well: direct deposit and PTO management.

ADP

This is one of the most trusted payroll companies in the US. There are a handful of packages for ADP, and they can get pretty involved in recruitment, job postings, basic HR support, and HR Pro.

Intuit Quickbooks

We only work in QuickBooks Online, so you would think that we'd recommend this payroll service to everyone, right? If you're using QuickBooks already, and you're not looking for more than a good sync to QBO, then, fine, this might work.

However, the pricing in the very beginning is lucrative, but it's based on a trial run. After that, you'd have to backtrack and it would end up costing more money to get a better platform. The service just doesn't have a ton of flexibility or add-ons.

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An Affordable Bookkeeping Alternative to a CFO

Outsourcing your bookkeeping is more affordable than you would think. We save you money the moment you hire us by cutting out the expensive cost of hiring an in-house CFO.

Working with a remote bookkeeping service will still provide you with all the value you could get from an in-office bookkeeper but at a fraction of the cost.

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Learn How We Can Impact Your Business Growth

You’ve got your company’s best interest in mind. Guess what? So do we! You can rest assured that we will work closely with you to create actionable business plans and accurate financial reporting. We offer our toolkit of financial intelligence that will be your greatest asset for business growth.

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