Although a payroll service is an added expense, it may be just what you need for your business. Below are 5 things for you to consider.
- Allows more focus on growing your business. If you, as owner, or a key employee is focused on the management and processing of payroll, it can take away precious time that could be used to grow your business. By outsourcing your payroll responsibilities, you will have more time to focus on growing your business.
- Accuracy and compliance. Outsourcing your payroll services to a qualified company will help to ensure your bookkeeping is accurate and in compliance with filing regulations for things such as, tax withholdings, ever changing labor regulations, bookkeeping updates, etc.
- Lowers audit risks. A payroll service can give you peace of mind knowing they are up-to-date on local, federal, state taxes, Social Security, Medicare, unemployment taxes, and overtime requirements. This will reduce your risk of an audit while providing audit assistance if you need it.
- Improves internal controls. Every business should know that the separation of duties is important for internal control, though it’s a little tougher if it’s a small business. A business may be more susceptible to fraud or embezzlement if you only have a 1 or 2 person payroll department. When you have an outside payroll service, it can provide you the checks and balances your business needs to stay protected.
- Efficiency saves money. Efficiency is key to reducing business costs. Having a professional service do your payroll increases your efficiency because it takes fewer hours to get the job done. Factoring in the time improvements and any potential savings in penalties and interest, will have a positive effect on your net income.
Outsourcing isn’t for every business but understanding the aspects of using a payroll services will give you something to think about as you review your situation. At Summit CPA we offer multiple resources that will help get your business on the right track. Contact our office at 866-497-9761 to schedule an appointment with our Virtual CFO.