Transitioning from a sole-proprietorship into an employer status is a mark of growth within your company. It is also, however, a trying time because it brings with it a lot of additional responsibilities. An employer's role for payroll processing and benefits management can be complex, and if you aren't well-versed in the processes, you can make potentially costly legal and tax-related mistakes. Here are a few things to consider about working with a payroll service instead of trying to handle it yourself.
Simplifies Time Tracking
When you work with a payroll service, it can simplify your company's time tracking significantly. Whether it means that you just scan in timecards every week or your employees log into a digital system to track their work hours, it will mean that you don't have to calculate all of those hours on your own.
This can reduce the risk of human error on your part, or on the part of your in-house payroll staff. Since payroll calculation errors can steamroll into payroll tax payment errors due to those miscalculations, this is an important and costly consideration.
Automates Tax Payments
Managing a growing company is a full-time job. With so many details to consider, sometimes the smaller things, like periodic tax filings, can slip through the cracks. If you miss a payroll tax filing, it will come with some significant penalties from the IRS that can accumulate quickly.
Working with a payroll service takes the payroll tax filing responsibility out of your hands. Your payroll service will set aside funds every period for your payroll taxes and will pay those taxes by the filing date every period. This ensures that you stay in compliance with the IRS, protecting your company from costly penalties and problems.
Includes Benefit Management
When you offer benefits for your employees that are payroll-deducted, it can be a challenge to sort out who receives what deductions during each payroll period if you're doing the payroll on your own. A payroll service, on the other hand, will handle all of the benefits tracking and deductions for you every pay period.
Ensures Garnishment Compliance
Another thing that many small business owners often overlook is the wage garnishment orders for employees. If you have an employee with a garnishment order for child support, back taxes, or a court order, you must be withholding a certain amount from their check every period in accordance with that order. The withheld amount must be paid to the garnishing agency in a timely manner.
Payroll processing services specialize in this type of work, so they can keep track of all of these garnishments and payments with ease. Trying to do so on your own as a small business owner can be overwhelming, especially if you have several employees on staff with orders.
As you can see, working with a payroll processing service can save you a lot of time, hassle, and money. Contact a service near you today for more information.