(Newswire.net — July 20, 2018) — Payroll processing is a very important function in any business; big or small. However, not all businesses can afford to have an in-house payroll department. It c For a small business, it might not make a lot of sense to have an in-house payroll department. Small business here refers to a business with 30 or fewer employees. The more sensible option for such a business would be to outsource payroll. This article highlights a few reasons why outsourcing payroll makes more sense.
1. More economical
It is quite expensive to run an in-house payroll department, and these costs cannot be justified if you have a small number of employees. You will need to have fulltime staff in the payroll department, which means that you will have to pay each one of them a salary as well as other employee benefits such as paid maternity leave, medical cover, pension and all that jazz. It will probably cost you much less to outsource your payroll operations.
2. Saves time
As mentioned above, payroll processing is very time-consuming. There is a lot that goes into it; from determining the benefits that employees are entitled to, to calculating payroll, printing and distributing paychecks, maintenance of computer programs and software, keeping track of new hires and terminations, staying updated on tax rates, and so much more. By outsourcing payroll, your employees will be able to focus on their core responsibilities. Your human resource department will have enough time to take care of other pressing issues that may affect your bottom line in one way or the other. You can even do without a human resource department if you have few employees.
3. Confidentiality
This can be a big problem if payroll processing is done in-house. There have been cases of payroll employees telling other employees how much certain people are earning and this never goes well. It can cause issues such as jealousy at the workplace.
4. Avoid mistakes
You can avoid costly payroll mistakes such as late or incorrect filing of payroll taxes by outsourcing your payroll. The penalties for these are quite high, and almost 50% of small businesses are penalized for various payroll errors annually. Your guess is as good as mine; most of these are probably businesses that choose to do their payroll in-house. When you outsource your payroll to a professional such as Qualitas Payroll, you can be sure that they are up to date with all the changes in tax laws and tax rates. Therefore, chances of making payroll mistakes are greatly minimized.
5. A higher level of security
Cases of payroll fraud have been on the rise in the last couple of years, and these are common among businesses that do their payroll processing in-house. There have been several cases of misappropriation of funds and identity theft, among other issues, and all these can be prevented by outsourcing your payroll. Professional payroll providers are likely to use state-of-the-art technologies that can identify and notify the business owner of any unethical activities.