Payroll is considered a nuisance by many small business owners. They hate doing it, don’t understand it and spend ages at it. And yet, it is possibly the easiest regular business function to outsource.
There are many specialist payroll bureau offering quick and easy solutions for payroll, including ensuring that all of the returns are made on time and eliminating the risk of penalties. For a function to be suitable for outsourcing it should either reduce the cost or improve the quality. Payroll outsourcing generally achieves both of these. Improvement in quality is generally pretty obvious because the accuracy is improved and properly printed payslips and reports are produced so that employees have greater faith in the management.
Some small businesses argue that there isn’t a cost saving because they do it themselves. Of course there’s a cost saving unless you think your time is worthless.
One client of ours used to do her own payroll for two employees every week. She estimated that she spent between 15 and 20 minutes per week and couldn’t evaluate how much time she spent at year end.
We took over the payroll and she rings us with the employees’ hours. Because there are only two employees, we can calculate the net pay while she’s on the phone (about 2 minutes). Payslips and summaries are in the post that day. Job done – quickly, accurately and efficiently. Time saved by the client is between 15 and 20 hours per year. She earns around £25 per hour so her extra earning capacity from outsourcing her payroll is possibly £400. Does she pay £400 for the payroll service? No she doesn’t pay anywhere near that.
And, there are other benefits. She can contact us with employment related queries, we deal with HMRC enquiries and she has confidence that tax and NI are being correctly calculated.
And what about workplace pensions?
If you employ at least one member of staff you are now required to meet certain obligations in terms of workplace pensions.
Our team can take the headache out of auto enrolment. We will look after all of the necessary day to day administration and ensure your business remains fully compliant at all times.
Outsourcing payroll frequently makes sound economic sense so, if you want to grow your business, please consider it – talk to your accountant and check what payroll services are available. Of course, we’d love to help you and you can contact us here.