Tips on Outsourcing Your Small Business Payroll

For those small business owners who find that they just don’t have enough hours in the day to get everything done, outsourcing certain company operations, such as payroll, can be cost-effective. It can also relieve stress and reduce the possibilities of errors. Among some of the greatest benefits of outsourcing your payroll is that it gives you, as the business owner peace of mind knowing that payroll is being completed by professionals. A few of the other benefits are:

  • Reduces payroll mistakes
  • Payroll is completed on time each week
  • Greatly reduces possibility of IRS penalties
  • Eliminates risk of missing payroll deposit deadlines

Most small business owners try to handle everything right in the beginning in order to save money. Though this is sometimes necessary, having an accounting service on board right from the beginning means that all your record keeping tasks will be set up correctly from day one. Incurring just one IRS penalty in the course of a year can pay for the services of a qualified bookkeeping firm. If however, you can only afford to outsource one thing, then payroll is usually the best bet.

How to Tell When You Need to Outsource Payroll

Most of us live by the old saying, “If it ain’t broke, don’t fix it.” If your payroll is getting done correctly and on time each week and your quarterly IRS payments are being made on time, then you may not need to outsource your payroll yet. If you sometimes experience problems getting your payroll deposits in on time, then this is not only bad for the moral of employees, but it can also cost you up to 10% in penalties.

Employees are much happier and more productive when they know they will get paid on time and that their paycheck amount will be correct. When mistakes start happening, this can cause an unsettling ripple effect through your company. Employees can lose confidence in your business and start to worry that it might be in financial trouble. As a small business owner, you never want to inadvertently send negative signals like this.

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