Cut Costs And Dodge Tax Penalties With Payroll Services

Many small and large businesses are choosing to outsource their payroll. When compared with handling payroll in-house, outsourcing can free time, alleviate HR headaches, reduce costs and leverage payroll expertise.

Cut Costs

By paying another company to handle payroll, business owners can save a lot of money. There are several direct costs of handling payroll in-house. A typical small business has about 10 employees and will spend close to $3,000 every year on labor that is required for handling in-house payroll.

By paying a company to handle payroll, most businesses can save anywhere from 20 to 30 percent. Companies that have more than 10 employees can save even more money.

Dodge Penalties

Each year, the IRS penalizes thousands of businesses. In fact, statistics show that almost half of all small businesses end up paying close to $1,000 a year in tax penalties. The two common causes for IRS penalties are incorrect and late filings.

The majority of companies that offer payroll services also offer a tax guarantee, which protects their clients from tax penalties. By itself, the guarantee of no tax penalties is enough to justify paying to outsource payroll.

Direct Deposit

A lot of companies have problems offering direct deposit. Hiring an external payroll service makes it much easier for a company to provide this benefit.

The percentage of employees who want to use direct deposit is always increasing, so it’s important that companies can offer it to their employees. For many employees, it’s an inconvenience to drive to the bank and cash a check.

By offering direct deposit, business owners are able to save time and avoid paper-handling errors. Outsourcing payroll is an excellent idea because it makes it easier for companies to offer direct deposit, so in the end, everyone gets what they want.

Leveraging Expertise

The government forms, withholding rates and regulations required for managing payroll are always in a state of flux. Many small business owners don’t have the required in-house expertise to keep up with all of these changes.

Outsourcing small business payroll is an excellent way to leverage the expertise of individuals who handle payroll for a living. Most companies that offer payroll services have payroll experts. A number of small business owners have trouble managing the latest technology that they need for their business.

The software needed to effectively and efficiently manage payroll is always being upgraded, and it’s almost impossible for small business owners to keep up. Paying for payroll services enables business owners to avoid technology-related headaches, and all of the other issues that are caused by payroll processes.