In the course of running and growing your business, there are inevitable responsibilities that always manage to drain an organization, or a staff member, of valuable time. Somewhere close to the top of this list of responsibilities lies payroll processing.
The payroll process can be a thankless, time-consuming administrative headache that is often thought of as a necessary evil. Regardless of the size of your business, payroll processing can sideline efforts to focus on more productive areas. Outsourcing can provide much-needed relief from this unprofitable administrative burden.
Due to the ever-changing payroll tax laws, filing requirements, human resource demands and the need to improve normal business practices, the payroll process has evolved and expanded in the past 10 years. Many payroll organizations train their staff in all areas of payroll, and many practitioners have their CPP or FPC payroll certification through the American Payroll Association.
Handing off your payroll processing to a seasoned service bureau is a great way to move your business forward, because payroll services can save you time, and ultimately money, through methods that include:
* Handling all aspects of calculating and printing paychecks or direct deposit notices and payroll reports
* Working directly with your CPA to provide payroll information as needed
* Submitting your payroll tax payments and tax filings in a timely fashion, thus avoiding tax penalties
* Providing a valuable professional resource when dealing with payroll-related issues such as a payroll tax notice or other governmental inquiries
* Providing a software interface to GL systems, time clocks, 401(k) administrators and other third-party providers
One out of every three employers will incur a penalty due to a payroll mistake each year. One IRS tax penalty could have a very negative effect on your bottom line. If you have ever had to respond to an IRS or other tax agency notice in regard to a payroll-related issue, you know exactly how time-consuming and frustrating this can be.
Payroll service bureaus can help insulate a business from these headaches. Most service bureaus will accept responsibility for payroll tax penalties, and any interest that is a result of an error made by the service bureau. What is even more important, however, is the expertise that a service bureau can provide.
It is not uncommon for government agencies to send erroneous payroll tax notices. With a payroll service bureau, you are not encumbered by these notices, as the service bureau will go to bat for you and figure out exactly what needs to be done.
Starting up with a payroll service bureau is generally easy and the ongoing process is smooth.
Payroll service bureaus have several methods of collecting your payroll information. There are the traditional call-in or fax-in methods. There is also PC-based service bureau software that gives the end user the ability to enter pay information and transmit it to the service bureau for processing. This method works well for clients who desire the greatest reporting ability and control over the data.
One of the most flexible methods is to enter your payroll and view the information via the Internet. An Internet-based system is a good choice for those who have a need to look up or enter payroll information from multiple physical locations such as the office or home. More important, an Internet browser is all that is needed to get started.
Payroll service bureaus can ease a lot of other business processes as well — assisting with HR, timekeeping, 401(k), custom payroll requests and GL interface solutions. No matter who you choose to handle your payroll processing, it is important to establish a good working relationship with the processor.
By removing much of the administrative burden associated with payroll, you can spend more time working on revenue-generating tasks.
Robert Gialamas, FPC, is president of Paytime Payroll Processing, a leading independent provider of payroll and human resource solutions. Reach him at [email protected], (800) 579-9529 or www.Paytime.com.