Last Updated on Mar 11, 2020 by James W
If you’re running a small to mid-sized business there’s a good chance you’ve got your hands full with the operating tasks that only you are qualified to do. Many business owners find payroll a tedious, even painful, task that’s fraught with the potential for disastrous mistakes. You can wind up spending so much time on payroll that you don’t have time for any of the other things that go into running a business, or any time for your family, or any time for yourself.
If you’re struggling to get payroll done each pay period, having problems making your payroll tax payments on time, or you’re not sure if your payroll tax calculations are correct, then it’s time to outsource your payroll to a professional. Outsourcing your payroll to a professional lifts the burden of payroll from your shoulders and leaves you more time to focus on the aspects of business management that you do best. It also protects you from the stiff tax penalties that could result if you do payroll yourself and bungle it.
Stay on the Right Side of the IRS
Tax penalties are one of the biggest potential consequences of messing up payroll. If you fail to make your payroll tax deposits on time, you could pay as much as 10 to 15 percent in late fees. If you make mistakes calculating your payroll tax payments, those mistakes could be held against you and penalties could be assessed for them.
Keep Your Employees Happy
If there’s a mistake with an employee’s pay, that’s something that needs to be rectified immediately — and fixing it will be a lot less stressful for everyone if you have a dedicated payroll professional in your corner. Not to mention, you want some confidentially surrounding payroll; if you hire an in-house HR person who chooses to share one employee’s salary with the others, you could find yourself struggling to deal with some jealous workers.
Payroll professionals do a lot more than just cut employee paychecks. Payroll professionals also handle employee benefits and W-2 filing. Offering your employees basic benefits like direct deposit and more comprehensive benefits like 401(k)s, sick days and vacation time, gets easier when you have a professional handling your payroll services. The more benefits you can offer your employees, the happier they will be in their positions and the longer they will be likely to stay with your company.
Stay Compliant With Employment Laws
Even if you don’t mind doing payroll yourself, outsourcing your payroll services can help you stay on top of current employment regulations. Employment law is constantly evolving and it can be impossible to keep up with changing regulations on your own. PEOs make it their business to know what current employment regulations require. Guarantee that your business doesn’t run afoul of the law when you outsource your payroll services to a PEO.
Lock Down Your Payroll Professional
When you hire an in-house HR professional, you’re placing a lot of trust in that person. Not only must you trust your in-house HR to protect sensitive employee data and be discreet when it comes to each individual’s pay package, but you’re also relying heavily on that professional to continue meeting your payroll needs as time passes.
What happens if your in-house payroll person decides to up and quit? If your bookkeeper leaves the company, he or she is taking all of his or her knowledge about the payroll process and your payroll in particular with him or her. You could find yourself scrambling to get payroll done yourself while you frantically search for a reliable, trustworthy replacement. When you outsource your payroll services, you guarantee that your payroll will always get done on time. Your employees will always get paid what they’re owed, the IRS will get what it’s owed, your benefits will be handled, and best of all, there will never be any payroll-related stress keeping you up at night.
Outsourcing your payroll services to a PEO can have numerous benefits for your business. It frees up your time so you can focus on doing what you do best as a manager or business owner. It guarantees that your taxes are paid, your employee benefits are arranged and you stay on the right side of the law. When you outsource your payroll to a PEO, you can have all the benefits of an in-house HR professional — for a fraction of the cost.