Purchasing payroll service(s) from a third party can seem like a luxury for some employers, but small to mid-size businesses may be overlooking the benefits of outsourcing this critical business function.

Why Outsource Payroll Service?

While every employer is unique, they all share at least two responsibilities: processing employee payroll and payroll-related tax filings. These responsibilities are time-consuming and non-revenue producing. And though managing payroll in-house might seem like the most cost-effective solution, DIY processes often come with risks and hidden costs. Here’s why you should consider a third party payroll service provider:

• Compliance with IRS regulations is complicated. Proper worker classification and payroll taxes are both the employer’s responsibility. Not knowing how an employee should be classified (employee vs. contractor) and which taxes are required to be withheld (federal, state, and local) can land an employer in a complex mess of fines and legal trouble down the line. Plus, employers must also consider federal, state, and local labor laws. These responsibilities can be intimidating without payroll experts on staff, and more importantly, mistakes in these areas could cost your organization dearly.
• Human error results in inflated payroll costs. Human error is a fact of life that can bring your payroll processing down. Whether it is a mistake with data entry resulting in overpayment or not realizing a former employee is still on the payroll, unnoticed errors can end up costing your business significantly in the long run.
• Time spent on payroll is time spent away from your business. Outsourcing payroll service lets you focus on the real value-adding aspects of your business. The less time you spend processing payroll, the more time you have for what you do best.
• Feeling lost can be frustrating. As mentioned above, managing your own payroll is incredibly complicated with many pitfalls. Sometimes you just want an expert to help you through the most complex aspects of payroll. Outsourcing payroll service means you always have someone to answer your questions or take care of the toughest parts for you. Having peace of mind knowing your payroll partner is one phone call or email away helps make payroll less frustrating.