Payroll can be costly and complicated for most companies, especially when incorporating all the recent changes, like Real Time Information. It is the duty of a business owner to make sure all employees are paid the correct amount and on time. There are two options for dealing with payroll: outsourcing to a professional, or creating a team in house.
What are payroll requirements?
Before deciding whether to outsource payroll for your company, consider whether or not you have the necessary resources to deal with a payroll system in-house. Generally, a company will have a team of experts to deal with payroll, including someone with a background in accounting and an IT expert to maintain the software. Updates are required on a regular basis, and may be more complex now that there are changes to pension and pay reporting. Costs may vary for an in-house team, especially if something goes wrong. If you have limited resources, it may be preferable to outsource and concentrate those on other aspects of the business.
Time to spare
Dealing with payroll can be a full time job, especially at times during the month when reporting requirements peak. Real Time Information requires specified forms to be completed and submitted at certain times in the month. Failure to comply with the new legislation could mean a hefty fine from HMRC.
Maintaining confidentiality and reliability
The payroll for a company has to remain confidential at all times, along with being reliable. Employees expect to be paid in a timely manner on the agreed payment date. Failure to comply with this agreement could create bad feeling among staff, and may even result in the workforce leaving the company.
Can you afford to be flexible?
Running a company payroll requires a degree of flexibility to accommodate last-minute changes to legislation and requirements from HMRC. No matter how many changes are introduced, you have to make payments to employees on the agreed date. This could require extra staff or taking employees away from their regular duties in order to help with the extra responsibility.
How much will it all cost?
Very often, a reputable accountant will provide a full accounting solution, which will include payroll. You may find that you are able to pay a fixed amount each month for the service, which will help with cash flow management. An in-house team requires staff, hardware, software, and the extra costs for employees, like holiday and sick pay.
For advice about transferring payroll to an outsourced service, give us a call or leave us a comment.