Check If You Need To Outsource Your Payroll

Introduction 

Even the most thorough and experienced professionals find that payroll can be a headache. One stiff penalty for a tax filing omission, and now we're talking a full-blown financially-induced migraine.

For many companies, payroll services offer an attractive and useful substitute to in-house processing. Selected correctly, they provide a less expensive, simpler means of paying your employees, filing your taxes, and performing a variety of other duties.

However, choosing poorly is like starting a new job you weren't right for in the first place -- it's a hassle to leave, but if you stay, you'll be perpetually frustrated.

Organizations often initially process payroll themselves for any number of the following reasons:

• They consider in-house processing to be more cost-effective than outsourcing
• They are protective of wage information
• They want to maintain control over payroll data to handle last-minute changes.

In truth, smaller firms with a constant, salaried staff and minor changes in tax obligations may well be better off processing internally; it can definitely be more functional and efficient if your needs are uncomplicated. But many eventually discover it's not all that cheap; especially when you aspect in the time spent managing the process.

Plus, without the appropriate knowledge of payroll procedures and access to a sound payroll program, it's easy to make mistakes. Employees as well as government, state, and local tax collection agencies need to be compensated in full, on time, and in the proper manner. Usually, delayed payments are cause for monetary penalties.

Finally, using a payroll service can ease your mind. A survey has revealed that one out of every three firms has been charged for a payroll oversight, with total penalties reaching into thousand of rupees. And given the ever-changing nature of tax regulations, it's easy to make mistakes that can grossly affect your bottom line.

PI Manpower offers with the right payroll services. Our web based client portal and a CRM based client interaction and engagement process suite puts information in the hands of line managers, employees and corporate staff and has high and measurable standards for responsiveness and first time resolution.  

When to outsource?

While the majority of Indian businesses process paychecks internally, this is not always cost-effective. At minimum, internal payroll processing requires the purchase of a computer or manual accounting program and extensive training to use it. In addition, businesses need to keep up to date on changes in personnel, deadlines, and tax requirements on an ongoing basis.

Using a payroll service usually makes sense if your payroll changes with each pay period. If your company has employees working varying volumes of hours each week or has a significant turnover rate, a payroll service can be a time-saving and cost-effective substitute to internal processing. Also, using a payroll service can be beneficial if you have to pay payroll taxes for multiple states.

On the other hand, if your payroll expenses are quite stable, you may find handling payroll internally to be just fine for your needs.

Services provided 

A payroll company's basic services include analyzing payroll and tax obligations for each employee, printing and delivering checks, and providing management reports. Paychecks can be relased on a weekly, bi-weekly, monthly, semi-monthly or yearly payroll basis.

In addition, payroll firms can offer services such as automatic check signatures, envelope stuffing, and direct deposit of checks.

Many services now offer tie-ups allowing employees to designate automatic deductions from their paychecks. And for larger companies with more complex processing needs, some payroll providers have even begun to offer integrated HR software systems that track employee benefits-related information in addition to regular payroll data, PI Manpower is one of theseintegrated outsourcing companies.

Choosing a provider 

Besides providing the solutions you require, a payroll service should offer an advanced level of customer support service. Unlike some other business services, you will need to communicate consistently with your payroll provider.

If your sales representative will not be managing your account, make sure to speak with the customer service reps to ensure you will be satisfied. Also, consider inquiring references from current clients to gain a better sense of the provider's level of customer service.

You should look for a payroll provider that is within reasonable driving distance, enabling you to pick up checks in case of urgency. Also check that the company is bonded to ensure your company will not suffer from any potential financial mishandling.

Filing payroll taxes 

Many payroll services offer the choice of filing state and government payroll taxes for your business.

Typically, this service is offered at negligible or no cost. This is because the payroll provider will impound the tax due at the time paychecks are issued, earning interest on the funds until the money needs to be passed over to the federal.

Most services assume responsibility for penalties resulting from incorrect filing; however, your company may be liable for any interest charges.

Keep in mind that many companies will not calculate local or city payroll taxes. Make sure to ask about this if it is a major issue for you.

Why not check all the above points with a payroll outsourcing company now?

Filing electronically 

With the Electronic Tax Payment System your outsourcing company banks by phone with the government, transferring funds electronically rather than relying on checks to keep your "account up to date. 

Relaying information 

Each pay interval, payroll data has to be "called in" to the service provider. This can be done via telephone, fax or computer.

The telephone is the conventional way of communicating information. The biggest problem is typically finding a mutually agreeable time for both parties to be on the phone.

A fax machine eliminates scheduling conflicts and miscommunicated information, but can bring up security threats concerning who receives the faxes and who will oversee the fax being sent.

Communicating payroll by computer is often the most efficient method, especially if you have a larger payroll.

Nowadays, several national payroll providers have offer payroll data transmission over the Internet. This simplifies payroll for many businesses, allowing them to download payroll information from any computer that is Internet accessible.

Pricing 

The market for payroll is competitive and reflects local market conditions. The amount of the base fee depends on the pay interval, with the less frequent payroll periods costing more. Over a year, however, less frequent payroll periods will cost less to maintain.

With direct deposit, there is often a nominal transaction charge per check in addition to the base fee. Furthermore, there can be fees for adding or dropping employees, adjusting employee information, or setting up your account. Fees can differ considerably across services, so it is important to check them out before signing up for a service.

Since pricing for services is relatively negotiable, try to avoid multiple unnecessary charges by knowing which service features you are most interested in before choosing a payroll company.

Click here to check the cost of payroll services now.