Too many payroll errors?
If you’re like most business owners, rather than focusing on your payroll, you’d rather be putting your energy into the quality of your products and services, staying competitive, and keeping your customers happy. However, payroll is a critical aspect of running any business that employs people because it presents numerous challenges. If you get it wrong, morale will take a serious knock when salaries are incorrect or late, and non-compliance relating to tax and labour laws can lead to significant penalties.
Outsourcing your payroll
A solution to this dilemma is to outsource your payroll.
Outsourcing isn’t a new trend. It’s been around since the 80s when it was primarily used by large multinationals. Today, however, savvy owners – of any size business – can and do outsource non-core services.
After weighing up whether to devote time and energy into developing manpower and know-how to keep up with payroll legislative changes and all the administration and queries that go with it, versus managing their businesses, generating sales, and achieving revenue growth – outsourcing makes a great deal of sense.
Common problems with in-house payroll
Managing payroll in-house is fraught with challenges, some of which include:
- The time it takes to manually process payroll, as well as the risk of input errors.
- Staying up to date with employment law and regulatory changes.
- Maintaining accurate records for compliance.
- The possibility of data breaches that undermine privacy and confidentiality requirements.
- Under or overpayments to staff cause morale issues and complicate year-end calculations if they’re not caught in time.
- Varying benefits requirements for full-time versus part-time or contracted workers.
- Tax non-compliance.
- Managing changes to employees’ personal information.
- Managing and analysing payroll data to make effective resourcing decisions.
- Payroll systems can be compromised if they’re not fully integrated with the company’s other business systems.
- Administrative costs to manually manage payroll are significantly higher than using a modern, cloud-based payroll system.
- Backup systems must be kept up to date to avoid lost data.
Advantages of outsourcing
An accountant will help you with your payroll tasks and ensure your business is legally compliant. But be sure to hire someone who is accredited, who knows the law, and who makes record-keeping a top priority.
Another benefit is that by outsourcing your payroll, you won’t have to hire an employee, which saves you money on everything from benefits to training. Additionally, you’ll have access to specialised professionals at a fraction of the amount it would cost to employ them full-time.
You only have a certain amount of time in the day and the most important thing you should be focusing on is business development. Payroll tasks can eat into this precious time, especially if these are not something that you’re adept at doing.