10 benefits of payroll services for small business
Growing your business to the point where you need to hire staff is part exciting, part daunting. Not only do you have to look after your employees’ performance and wellbeing but you also need to make sure you pay them on time and the right amount. You could set up and run your own company payroll, but it can be time-consuming and easy to make mistakes. The answer is using payroll services for small business so you can get on with running your business knowing your staff will always get the right wages or salary payment on time. Let’s look at all the benefits of using an outsourced payroll provider, which could be standalone payroll services or via your accountant.
The benefits of payroll services for small business
1. Time savings
One of the most compelling reasons to use payroll services as a small business is the time saving aspect of outsourcing. Many payroll services specialise in automating payroll processes, reducing the amount of time it takes to manage your finance admin. Using a third-party payroll provider frees you and your finance staff to handle other activities.
2. Cost reduction
Maintaining an in-house payroll department can be costly, especially if your business is growing fast and hiring a lot of new staff. If you work in an industry that traditionally has a high turnover of staff such as hospitality or retail, you may find it challenging to keep on top of all the payroll related activities such as onboarding new employees, managing additional payments such as overtime or bonuses and coping with all the changes to the personnel list. When you use payroll services for small business, you’ll usually pay a set amount per payslip per month so you can calculate the cost quickly and easily based on the number of staff. You can save on salaries, training, and software costs by removing payroll admin from your in-house team and using an outsourced payroll provider instead.
3. Enhanced accuracy and compliance
Getting payroll incorrect can lead to employee dissatisfaction and issues with HMRC. Moving your payroll processing to a payroll services company or your accountant means more accurate calculations, timely tax filings and reduced risk of errors and penalties. In addition, the best payroll services for small business will keep on top of changing regulations such as adhering to the minimum wage requirements to ensure you are always compliant.
4. Improved data security
There’s barely a day goes by when we don’t hear about some data breach or other in the news. Payroll services companies implement strict security measures to protect sensitive employee data from breaches, meaning you don’t have to worry about data confidentiality issues.
5. Employee satisfaction and self-service
Running the payroll and making payments into your employees’ bank accounts is one small part of the finance admin associated with having staff. Employees need timely access to their salary and tax information, especially at tax year end if they need to file a self-assessment tax return. Often, payroll services online offer small business’ staff a portal where they can download payslips, P60s and other tax related documentation. This frees up your in-house admin staff from many common payroll related queries and enhances employee satisfaction when they can find information easily themselves.
6. Advanced reporting and analytics
Staff costs are often one of the biggest spend areas for SMEs so access to payroll reporting can greatly improve decision making. Payroll services companies can offer reporting to:
Track employee wages, other payments and deductions
Ensure you are compliant with tax and other legal requirements
Monitor your payroll costs for informed decision-making
Provide accurate information for financial reporting and auditing
7. Scalability and flexibility
As your business and employee base grows, you can easily keep pace with additional demands by using outsourced payroll services. If your business is seasonal and needs to hire more staff or downsize your operation, or you need a more flexible workforce, with part-time, job share, migrant, CIS or freelance workers, a payroll services company is well placed to deal with your changing needs.
8. Recruitment and retention support
Recruiting staff is time-consuming so you could choose to have your outsourced payroll services provider manage some of the admin, such as background checks and collating required documentation. This can speed up the recruitment process which can lead to greater productivity and profitability for your business.
9. Enhanced employee management
Payroll services online platforms can often be integrated with other systems such as people management software for tracking holidays and other absences, expense management, employee benefits and performance management. By linking systems together, you can reduce data entry duplication and errors, reducing the time and cost of your admin functions.
10. Peace of mind
Payroll is one area of your finance admin that is costly when it goes wrong. It can damage your reputation with employees, can deter future employees from working with you and it can end up costing you extra to put things right. On top of that, you can get into hot water with HMRC if your PAYE reporting is late or incorrect. It’s just not worth the aggravation to handle it yourself if you are in any doubt about how to do it accurately. Leave all the stress behind when you outsource your payroll to a professional payroll services company so you can focus on the things you do best.
Get the best payroll services in London for your company today
If you’ve got payroll headaches or you aren’t sure how to get started with paying staff, let’s chat. Call us on 01322 250 001 or complete our online contact form today.
Frequently asked questions about payroll services for small business
What is a fully managed payroll service?
A fully managed service means you will not require in-house payroll staff, computer software or training for your staff. Get all the benefits of a comprehensive payroll service with none of the responsibilities or overheads.
How much does it cost to outsource payroll?
Each payroll service provider will cost their services differently but often costs are calculated on a per payslip basis. In London, you could expect to pay £4-6 per employee per month to run and report the payroll. Other costs such as setting up or making changes to employee data will be additional.
When should I consider outsourcing payroll?
If you are struggling to process your payroll on time, you have made significant errors that have adversely impacted your staff or you’ve incurred fines and penalties for late submissions, it could make good business sense to use payroll services for small business to avoid these issues in the future.
Where can I find more information about payroll and PAYE?
The best place to start for payroll and PAYE information is on the government’s website.
