Whether your grounds-care business does payroll manually or uses a service, the time is right to reevaluate your payroll processes — the outsourcing options available to small businesses are better than ever.
Remember when you first started your business? Everything was about growing your business and focusing on the business of growing. But over time, you got bogged down with tedious, time-consuming administrivia that prevents you from focusing on your core business. Instead of growing your business, you're suffocating under a pile of mind-numbing paperwork.
The worst culprit? Payroll. Everything involved with payroll is time consuming. For starters, you've got to keep track of payroll regulations and changes in withholding tables. Calculating the actual payroll amounts and deductions is equally tedious — and it's very easy to make a mistake.
Then, there's the arduous chore of writing checks and making all the proper quarterly and end-of-year filings for federal, state and local payroll taxes. It's not uncommon for small businesses to spend two to three hours processing each payroll if they do it manually.
Mistakes are costly. Employee morale dips when you give an employee a check or a W-2 with errors — they quickly lose faith in management when that happens. They may forgive, but they don't forget.
The Internal Revenue Service never forgets and is far less forgiving than employees. File late or with an incorrect amount and you'll have to pay a payroll penalty. Every year, four out of 10 small businesses pay an average fine of $845 for payroll errors. When you add it all up, that's billions of dollars in fines.
Plus, there are new fines that will penalize you if you don't keep good payroll records. California passed a new law that imposes a $750 fine on small businesses that aren't able to quickly produce accurate payroll records upon an employee's request. Experts believe that many other states will follow with similar legislation.
When you consider these penalties and the value of your time, processing payroll internally can be a very costly proposition. If you're tired of all the headaches associated with payroll, it may be time to take a look at outsourcing payroll. Payroll service offerings today are better than ever, and now is the right time to be thinking about making a switch.
IS NOW A GOOD TIME?
While the end of the year is the best time to sign up with a new payroll service, it's never too late to make a switch — especially if you've just completed all of your payroll tax chores and it's convinced you to outsource it so that you're not faced with doing it again next year. Doing so requires more paperwork than if you changed over at the end of the year, but the extra effort will save you payroll time each month, so anytime is a good time to make the switch.
WHAT'S NEW IN PAYROLL?
The Internet has greatly improved the process of outsourcing payroll. With an online payroll service, you can enter and view payroll information from anywhere at anytime, as long as you have access to a Web browser.
Once you enter your payroll data, the service automatically calculates, deducts, pays and files all federal, state and local taxes. Paychecks can be printed on your laser printer or can be routed to your employees' bank accounts via direct deposit. W-2s are automatically prepared at the end of the year.
The key benefit of online payroll is enhanced control. Traditionally, payroll providers required small business owners to call in payroll at a designated time, even if that meant having to leave an important meeting with a customer or an employee. With an online service, payroll can be processed whenever it's convenient.
Control also comes through the ability to modify payroll information in real time and view your payroll calculations instantly. With traditional “offline” payroll providers, the small business owners act through an intermediary — the payroll clerk — who enters the data. When mistakes are made, which frequently happens, the small business owner doesn't know it until the checks arrive.
Finally, control is increased through the availability of reports that let you track and monitor your payroll. Employers have access to online payroll reports in real-time after logging into a secure Web site. Similarly, employees can log in and access and print their payroll records, thus alleviating an administrative burden that frequently arises when employees need proof of payment history for loan applications and other purposes.
Beyond increased control, online payroll lets small business owners save time and money. It only takes a few minutes to process payroll online, so time is freed up for getting new customers or spending time with your family.
How do the new services save money? Because the new online payroll services don't have the same cost structure as traditional payroll services, they can charge 30 to 50 percent less. Moreover, many payroll services guarantee that you won't incur a payroll penalty, which can represent a considerable savings.
TAKING CONTROL OF PAYROLL
Outsourcing payroll is a no-brainer. It simply doesn't make sense to waste time, money and resources on a tedious task that is ancillary to your core business.
Getting started with payroll outsourcing is easy enough. You can find the payroll service that's right for you by searching on the Web or by asking your colleagues for a recommendation. In many cases, you can simply enroll online and get started immediately.
The bottomline? Making payroll is something that small businesses have to do; but the good news is that, from a process perspective, it's getting much easier to “make” payroll. Switching to a payroll service can alleviate pain and let you focus on what's most important — growing your business with focus and attention, just like you used to do back in the good old days.
Michael Alter is a senior vice president at SurePayroll. His company offers a Web-based payroll service designed exclusively for small businesses. You can reach him at 877-954-SURE.
If you've decided that outsourcing payroll is for you, contact any of these providers to find out more.
ADP offers a full range of benefits, payroll and business management services. Visit www.adp.com for more information.
Ceridian is a large national payroll processor. Ceridian recently introduced a Web-based payroll solution, PowerPay. Visit www.ceridian.com for more information.
Paychex is a national provider of payroll, human resource and benefits solutions to small businesses. Visit www.paychex.com for more information.
SurePayroll uses a Web-based plan to offer small businesses service. A flat fee includes payroll processing, tax filing and payment, quarterly reports and more. Visit www.surepayroll.com for more information.
- Wells Fargo
Wells Fargo has been offering payroll services to small companies for 40 years. Their OnlinePayroll offering is for businesses that want to run payroll online. Visit www.wellsfargo.com/biz for more information.
TIME TO OUTSOURCE PAYROLL?
When is the right time to outsource payroll? Here are some signs that you may be ready.
Processing payroll is taking up too much of your time, and you'd rather use that time to focus on other things.
You find it difficult to keep track of when you need to pay federal, state and local payroll taxes.
Your company has received payroll tax penalties for filing late or for other payroll errors.
You've made errors calculating payroll and have had to re-issue payroll checks.
You're having trouble keeping up with changes in payroll tax rules and regulations.
Your employees have been asking for direct deposit and you'd like to grant their request.
You've been so busy that you forgot to issue payroll.
You're anticipating growth in the next year that will involve hiring many new employees.
You're planning on implementing a benefits program that will add a new level of complexity to your payroll deductions.
You don't have proper records or controls in place concerning employee vacation time and sick days.
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© 2016 Penton Media Inc.