Benefits of Outsource Payroll Duties
Nowadays, many employers prefer to outsource their payroll and other tax related duties to third-party payer. These are commonly called outsourcing payroll service providers and reporting agents. To understand the benefits of payroll outsourcing, one must understand its meaning in detail. In simple words, outsourcing payroll is a business practice, which involves contracting with a third party to handle all functions related to the company’s payroll. The need for an outsource payroll process arise when a company needs a third party affiliation to handle the pay roll process, therefore, they in turn do not need to define and maintain a large payroll department. Payroll outsource service providers can manage diverse range of functions including the calculation of wages and salaries, withholding taxes, distribution of withheld fund to proper government agencies, and direct transfers of net pay into the salary accounts of employers.
Many employers have experienced benefits of outsourcing payroll. Here we look at some of many advantages of taking up these services.
A Perfect Time-saver
Outsourcing payroll is a perfect way to save yourself from a time-consuming process of payroll. This service will alleviate the burden of your current staff who waste time in taking care of the payroll process. Instead, they can invest their time in activities that will add value and generate higher revenue for the company.
The cost involved in completing a payroll process can be greatly reduced by hiring an outsourcing payroll provider. You might think of hiring a part-time bookkeeper, however, you will still end up paying much more than you do if you choose outsourcing payroll process.
In many statistics, it has been revealed that a minimum of 40% of small to medium scale business enterprises pay substantial amount of fees per year, either because of delayed filing or because of incorrect payments. Outsourcing payroll agencies provide a tax guarantee. They ensure that the clients don’t have to face penalties, as they take responsibility of the same in case it occurs. In majority cases, the cost saving aspect, immediately justifies outsourcing the pay roll.
Ease of Operation
Anything is immediately better than the onerous task of manual payroll. Business owners or corporate manager who invest in outsourcing payroll services are guaranteeing ease of operation, most importantly, alleviating all pain or hassle pertaining to manual payroll.
It is difficult for a business to provide direct deposit without the assistance of an outsource payroll service. In small to medium scale businesses, employees prefer to have a direct deposit and avoid that trip to that bank, which is a big hassle to do regularly.
Evade IT-related hassles
For a small business owner, a constant concern is whether or not their systems are uploaded with the latest version of pay roll software. In fact, the entrepreneur cannot afford to make grave mistakes, because of outdated tax tables. In case of any error, the owner has to pay heavy penalties. With outsourcing payroll, they can rest assured that latest tax slabs will be used.