Payroll can be one of the hardest and most time-consuming weekly activities for small businesses and their HR team. Staying up-to-date with tax codes can be challenging for business owners and errors can result in fines that can get you into hot water with your revenue agency. Avoiding such mistakes, ensuring tax compliance and benefiting from the ease of ongoing payroll administration can not only save cost but can also enhance overall operations efficiency. That’s why many small businesses are opting to outsource their payrolls.
Choosing to outsource can be a challenging decision, especially when handing over sensitive company data is concerned. Finding they best company and knowing what to ask them is critical when making this transition. We’ve compiled some of our top tips to help you out along the way!
Compare your expenses before and after outsourcing
Before you spend hours looking into different payroll companies, you need to know if it’s a financially viable option for you. Is it worth it for your business to outsource its payroll? Time is money and payroll often takes up huge chunks of time – so, think of outsourcing as an investment.
Is the company respected?
Handing over sensitive company data is stressful enough. You want to trust the company you’re outsourcing your payroll to. Researching information such as how many clients they have, what type of software they use or how long they’ve been in business, can help you gage whether or not you can rely on them in the long run.
Most payroll companies provide standard services such as running payroll, depositing funds, issuing cheques, withholding payments, filing government reports, calculating provincial/federal taxes, employee benefits, withholding social security and pension contributions.
Know what services they offer
Not all payroll companies are created equally. Understand what services they provide and make sure all your necessary services are covered before committing. The services your business needs will depend on the complexity of your company’s specific needs. Before committing to a company, make sure they provide the services you need and you’re not paying for extraneous services that you are not benefiting from.
Check their overall error rate
Fines resulting from incorrect information and other payroll mistakes can hold your business back and potentially get you into trouble with your revenue agency. Good payroll companies can help mitigate this by being the experts in the business by staying up-to-date with new tax codes and other federal and provincial changes. Nonetheless, checking a company’s record and error rate is an extremely important component before committing your business to their services.
Is this provider easy to contact?
Does this provider offer good customer service? Trusting a company with sensitive data is a big responsibility. Knowing that you can contact them easily and receive a quality response is key to helping ease the anxieties that come with such a decision. Knowing a company is accountable is the basis of a strong foundation between your business and the payroll company. Receiving a swift reply in response to updates on company changes and any concerns with errors or system/file updates is a marker of a respectable company.
As with anything, there are some practical problems involved. These include general tasks like losing control of certain company data, potential security concerns and other risks involved with outsourcing. This is where research is key. Taking time to look into a company before making a final decision is critical when dealing with highly sensitive information. Another concern to look out for is an foreign administrative requirements.
Take your time and really look into the companies you’re interested in. Make sure they are respected in the business and can be held accountable. Evaluating all your options before committing to a company will give you the best chance of finding exactly what you’re looking for and genuinely making the payroll process easier.