In-House Payroll Costs Can Add Up
Which do you prefer: payroll outsourcing or handling your payroll in-house? Many SME owners believe that in-house payroll management is the most efficient and cost-effective system for their businesses; however, this is not necessarily true. In-house payroll management has many hidden costs in the long run.
Despite the several benefits of outsourced payroll services for SMEs, many businesses are unaware that outsourcing payroll is a cost-effective alternative to in-house payroll management. We’re here to discuss the hidden costs of in-house payroll management so that you can make informed payroll management decisions and save money and time.
To begin with, most SMEs process their payroll manually. After all, isn’t payroll just about adding numbers, transferring employees’ salaries, or writing cheques? Well, you may be surprised to find out that payroll management processes go far beyond that. Hence, businesses have no choice but to adopt technology-driven solutions for their payroll once they expand and discover that their payroll management now involves complex tasks.
Adopting technology-driven solutions for payroll involves costs associated with servers, licenses, upgrades, security, maintenance, and IT personnel. However, the cost of investing in an in-house technology-driven payroll system may seem overboard. Therefore, it can become necessary for businesses to outsource their payroll because payroll outsourcing costs cover both the fixed and variable costs associated with payroll management.
Some legislation governs employee payroll. Therefore, you will have to deal with several compliance issues if you process your payroll in-house, especially with the ever-changing payroll laws and regulations. Consequently, your time, effort, and resources will be required to ensure your payroll is secure, accurate, and compliant. However, can you always guarantee this time, effort, and resources?
An outsourced payroll solution can eliminate the expense of time, effort, and resources. Furthermore, you won’t have to worry about maintaining legislative compliance with employees’ pay, real-time information (RTI), payroll tax, tax law changes, pension auto-enrolment, and new employment and wage laws.
Cost of continuity
Do you stop paying staff if the person responsible for payroll falls sick or if a pandemic occurs? What if you have a shortage of personnel on your payroll team that you didn’t plan for or expect? You will always need to pay your employees, despite these potential challenges.
These are just some of the issues you will have to deal with if your business runs in-house payroll. However, with payroll outsourcing, there are no long-term commitments. So, you can quickly eliminate stress, delay, and loss of resources from your business operations.
After considering the hidden costs of in-house payroll, can you still say it is more cost-effective than outsourcing payroll? Can your business afford to waste more time and money? Indeed, outsourcing your payroll may be more cost-effective, no matter how complex your payroll is. Similarly, it will save you time to focus more on business processes, operations, and growth.
If you are interested in a cost-effective partnership that allows you to focus on core business operations, then consult Pay Check today. We can help you run your payroll reliably and cost-effectively with our expert payroll services.