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Outsourcing payroll services – why it makes sense

When running a business, time is money. In order to make sure as much time as possible is spent focusing on actually running the company, it can make a great deal of sense for many business owners to outsource their payroll to a qualified person, such as a trusted accountant.

An accountant will be able to carry out payroll tasks more efficiently, and in a much shorter space of time than the average business owner, for whom this is not a field of expertise. There is also the advantage that with someone experienced doing the job, payroll errors will become much less likely. As mistakes can be stressful, and take time and effort to resolve, it can be a relief for a business owner to hand over the important job of handling the payroll to someone who is not only an expert but also a professional who will take full responsibility for getting it right.

Spending money to save money

Of course, it costs money to outsource payroll services, and this is one reason why some firms like to try and administrate the payroll in house. It is possible, however, that outsourcing could actually save money in the long run. This is because the superior abilities of the accountants doing the work are likely to make them much more efficient than unqualified employees or business owners who try to cope with the payroll by themselves. As a result, the cost of paying an accountant, in terms of the reduced hours spent on the payroll, could work out less than the cost of paying someone inside the business who takes far longer to complete the same amount of work.

Another advantage of outsourcing payroll services is to guard against catastrophes. It could be a disaster if the payroll system is unavailable when needed due to technical problems. A professional firm with a lot of experience in providing payroll services is likely to have special systems in place to ensure that whatever happens, payroll continuity will be guaranteed. There is also the benefit that reputable providers will adhere to best practices at all times, with the result that a company’s payroll will be run using the highest standards of efficiency and compliance with the regulations.

The future is already taken care of when outsourcing

As changes in legislation occur, they cause changes in what is required from those who administrate payrolls. A prime example is the Inland Revenue’s introduction of Real Time Information for PAYE in April 2013. This resulted in some businesses needing to send information more often to HMRC.

If the payroll has already been outsourced, there is no need to panic about alterations in the law, as the accountant in charge will already have all of the required information to hand and will be able to deal with any necessary changes to the system without skipping a beat.

A business owner trying to do everything in-house might be tempted to leave adjustments to the last minute, possibly resulting in panic, and the day-to-day running of the company could suffer as a result.

Posted by Louise
August 1, 2013
Features

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