Should My Business Use a Payroll Company?
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Outsourcing payroll duties to a payroll company is popular in the business world, but that does not necessarily mean it is the right move for your business. Deciding whether to use a payroll company is difficult without a thorough understanding of what will work for your company. If you are starting a business or are considering outsourcing payroll services for your already-established business, you should find out if using a payroll company or keeping payroll in-house could better fit your needs.
Tips for Deciding How to Handle Payroll
Choosing between hiring a payroll company and keeping payroll in-house can be a difficult decision, and business owners should weigh the pros and cons of each choice to determine which is best. Some advantages that a payroll company typically offers include:
Saving time – Many business owners believe they are better off spending their time concentrating on meeting the company’s goals rather than on administrative tasks like payroll. This is especially true for small businesses, since payroll duties may fall to the owner or an employee who has other tasks on which they need to concentrate. Businesses of all sizes often appreciate being able to spend less employee time on internal affairs, since this gives them more time to concentrate on improving business.
Avoiding payroll errors – Tax codes are notoriously complicated, and many employees not trained in these codes may end up making payroll mistakes that can incur penalties or affect the business in other ways. Payroll companies focus on this one facet of business, meaning they may be less inclined to make errors than in-house payroll administrators may make.
- Potential long-term savings – For some businesses, outsourcing payroll is more efficient and cost effective than keeping payroll duties in-house. Since these companies solely concentrate on payroll, they typically charge a business less than the cost of employing someone in charge of in-house payroll.
Should I Use Someone In-House to Maintain Payroll?
However, in-house payroll has a number of advantages, as well. In fact, payroll software gives companies control over the task while allowing them to handle paying employees without having to outsource. Some advantages include:
Easy access to information – If you need information on an employee’s pay history or any information about payroll, acquiring this data from a payroll company may take time. Having instant access to the data in your payroll software can make this task much simpler.
- Affordability for many businesses – Small businesses often benefit from payroll software. Companies with very few employees can buy software and begin handling their payroll in a short amount of time, which can prove to be a cheaper solution than hiring a separate company.
This is only a short list of the advantages each payroll method offers. If you are a small business owner, you should consult with your trusted resources, such as a business attorney, to decide which option is best for you and your company.
Attorneys Who Work with Business Owners in or Around Hoffman Estates
Running a company does not have to be an exercise in trial and error. Some mistakes can cost businesses greatly, or force them to close their doors permanently. Our lawyers know this happens all the time, but we want to help prevent legal issues from hurting your business. We have experience advising large corporations, small businesses and even nonprofit organizations. To get advice from an experienced business lawyer, call our office today.