A Knee Jerk Reaction Could Ruin Your Business
Understandably, many small business owners tighten their belts every chance they get. So in the discussion of whether or not to outsource payroll, some entrepreneurs have a knee jerk reaction and immediately say no. Is that really the wisest choice?
- They often say no before they have even checked into a service like The Payroll Department.
- They say no before they realize the payroll fees are very reasonable compared to the time it will take away from working to help their business grow and succeed.
In a recent taxation survey of 1500 small business owners, the National Small Business Association learned that 60% of small business owners handled payroll in-house while the other 40% chose to outsource. Those who choose to keep up with these responsibilities in-house don’t often understand the laborious efforts required of them. As a small business owner, you can expect to spend a minimum of six hours each and EVERY month on this task.
That six hours each month is required only for the paperwork. Constantly researching whether tax regulations have changed since your last payroll are not included in that six hours. When you really look at how much time you are devoting to payroll, you will discover that the amount of time adds up to nearly two weeks of time each year.
But as we are all aware, figuring hours and writing payroll checks are not the only tasks in the payroll chore. The Payroll Department reminds you of these additional responsibilities included in this very important part of small business success:
- Keep up with all garnishments and employee
- Withhold federal income taxes as well as other federal, state and local taxes for all
- Keep up with each employee’s vacation hours, both earned and used.
- File the IRS Form 941 four times throughout the year.
- For the end-of-year preparation of paperwork, you are also required to file W-2s and 1099s.
- Stay in the know about the ever-changing taxes with new laws and regulations.
If all you had to do was write a check, it would be easy. But payroll is more – much more – and if you make a mistake it is a costly mistake. Errors could actually jeopardize the viability of your small business.
So the next time you are thinking about outsourcing payroll to a payroll provider like The Payroll Department, don’t forget all these points. Contact Teresa Ray at The Payroll Department to find out how a payroll provider can actually help you move your business forward.
-Sherri of The Payroll Department Blog Team
