Is Outsourcing Payroll Right for Your Business?
Posted on March 22, 2013
What would you say if someone asked you why you process payroll in-house? Maybe your response would be, “That’s the way we’ve always done it,” or “It’s cheaper this way,” or “There’s never been a reason to change.”
The truth is, outsourcing payroll processing and tax filing is a smart way to ensure you are paying your people—and the government—correctly. The risks of doing it wrong are just too great: employment lawsuits, Department of Labor audits, IRS tax penalties, and the list goes on. If payroll isn’t the core of your business, it may be a good idea to outsource it.
Compare the two lists below: one includes the tasks, responsibilities and liabilities that come with doing payroll in-house. The other shows your responsibilities as a Paycor client.
In-house processing procedures and responsibilities
Processing a paycheck
# Calculate employee earnings
# Determine pre-tax deductions
# Calculate Social Security
# Calculate Medicare
# Calculate federal withholdings
# Calculate state withholdings
# Calculate additional deductions
# Total the amount of deductions taken
# Subtract deductions from earnings to calculate net pay
# Write or print checks
# Write or print check stub
# Sign checks
# Stuff and seal checks and stubs into an envelope
# Repeat for each employee
Responsibilities & liabilities
# Report all new hires to the state
# Calculate and pay employer and employee liabilities: Social Security and Medicare, federal unemployment insurance, state unemployment insurance, state withholding, local withholding, disability etc.
# File employer federal, state and local payroll tax returns
Paycor client responsibilities
# Go online anytime to add or terminate employees
# Report hours worked or salary earned
# Get back to running your business
See the difference? Let Paycor handle payroll processing and tax filing for you, so you can get back to your business. Read more about the benefits of outsourcing to a payroll and HR provider, then contact us to learn more.