Modern payroll is complex, covering everything from taxes to benefits to managing a variety of employees and contractors. As your remote finance team, we employ a robust tech-stack of cloud-accounting tools to streamline these exact payroll processes for you. These tools not only allow us to manage consistent, trustworthy compensation for your employees, but also provide best-in-class reporting capabilities and integrations with your accounting software.
But many may still be wondering, is outsourcing payroll really worth the investment?
If you’re a small business owner with only a few employees or have a history of managing payroll on your own, you’re probably hesitant to outsource this responsibility. Read on to see three ways that outsourced payroll provides value far beyond simply compensation management.
The Tax Arena
Paying employees properly is far more complicated than simply managing time, wages, and cash flow; you need to account for all of the complex tax details.
Outsourcing payroll includes offloading the coordination and liability of properly setting up and filing employees’ tax paperwork. System Six uses payroll specific tools like Gusto because, should a mistake or discrepancy arise in the tax filing process, Gusto takes on the responsibility of paying any fines and penalties associated with late or incorrectly filed returns.
With remote work growing in popularity and normalcy, registering employees for taxes isn’t simple. Small and big businesses alike employ remote workers across multiple states, cities, and municipalities. While this opens doors to valuable possibilities, it also creates new hassles in the onboarding process. In addition to differing tax codes, states have inconsistent implementations and descriptions of their rules and regulations. This can lead to confusion, mistakes, and possible penalties as you onboard employees.
When you outsource payroll, we ensure your employees are paid on time, but also partner with another firm, CorpNet, who assists with registering for tax accounts in states when you expand or hire in new areas of the country. CorpNet will communicate with each state on your behalf, ensuring that each state’s tax accounts are properly set up, submitting essential paperwork on your behalf.
Benefits Management
The second value-add of outsourced payroll tools is assistance with benefits management. A high priority for today’s workforce is the availability of benefits, including paid time off, insurance, and 401ks, just to name a few.
Just like tax registration can vary from state to state, benefit requirements vary also. For instance, certain states now mandate that all employees be provided paid time off, regardless of whether they are part-time or full-time. With remote work on the rise, employers may find employees working from states with varying PTO requirements.
Some outsourced payroll platforms have the capability of accounting for each state’s PTO requirements and codes. They can then track and manage PTO hours for employees, which is a huge time saver for business owners.
This is where we love using a tool like Gusto with our clients. Gusto offers both benefits packages through its own network of brokers and more recently added the ability to “bring your own broker.” This new feature allows its clients to reap the rewards of running benefits directly through the Gusto software while always maintaining a relationship with the broker of their choice.
While we’re singing Gusto’s praises, we need to mention a unique feature they now offer, the “Gusto Wallet” app. For the company with employees who occasionally request or find they need an advance on their paycheck, Gusto Wallet can be a lifesaver for employers and employees alike. Personally taking responsibility for and tracking advancements on payroll is risky and never advisable for business owners. With the Gusto Wallet app, however, employees can set aside monthly money from their checks that allow them to access emergency cash in between paychecks if the unexpected happens. Providing practical ways of making financial health a reality for employees is a huge benefit.
HR Tools & Support
The final added benefit is more robust HR tools. From advertising and managing job postings to job offers and onboarding to assisting with performance reviews, payroll platforms offer a lot of tools to help the modern business owner with HR responsibilities. For example, Gusto’s job postings integrate with popular job boards and their onboarding allows new employees to electronically sign custom documents, such as handbooks.
Some of these tools are newer to Gusto’s suite, and they can be a huge asset for businesses that need help getting off the ground and don’t have the necessary staff to take on all the HR functions themselves.
As a part of holistic client accounting services, we recognize the immense overlap between managing payroll and other elements of a healthy human resources department. Streamlining employee compensation goes hand in hand with caring for and supporting your employees. In simpler times, payroll was just a check every other Friday, but now payroll is intertwined with many facets of being an employer. Outsourcing this component of financial management is an incredible benefit to business owners; it allows them to focus on the business and not get lost in the financial complexities of PTO, benefits, family medical leave, and more.
Outsourced Payroll is for Everyone
These days it really doesn’t matter whether you’re a brand new start-up with just one employee or an established, multi-million dollar business – outsourcing payroll to a trusted partner is a great option for everyone. Simply put, the time, unnecessary costs, and headaches outsourcing saves employers are worth the costs.
So let’s talk – we are here to help companies set up and manage payroll as a part of our outsourced bookkeeping and accounting services. Whether you need to streamline your payroll processes, onboard employees across a range of states, or just need to get started with payroll, now is the time to integrate a fully tech-enabled set of financial systems to manage your business with efficiency and accuracy. And that will ultimately free you up to focus your time and energy on other priorities, like running their business, investing in their passions, or spending valuable time with family!