To Outsource or Not to Outsource? The Payroll Question
To outsource or not to outsource, that is the question. And by the end of this blog you’ll have your answer. Payroll is an arduous and time-consuming task that depletes your resources without directly generating customers or decreasing costs. Outsourcing payroll saves many businesses hours of time, money, and removes human error. Let’s take a look at the pros and cons of outsourcing your payroll.
Outsourcing Payroll Pros
- Cut your costs
Save money by outsourcing payroll because it is cheaper than paying somebody to do it in-house. Companies save money by not having to hire a payroll officer or IT professional.
- Redirect your resources
You can focus your resources on your business’s core competencies. There is no need for you or your employee to calculate wages and taxes when a payroll system is more efficient. Instead, you can focus on improving your products and services, generating new customers and optimising your operations.
You will have a dedicated payroll consultant that is an expert in all things payroll outsourcing. It is too costly for companies to directly employ somebody with such a high degree of knowledge; but when you outsource, you have affordable access to a payroll consultant. Small and medium sized businesses have trouble hiring an employee with the necessary qualifications and experience, meaning payroll outsourcing can make their processes more efficient and more competitive.
- Accurate tax calculations
Set up your payroll to meet Australian and New Zealand requirements. Employee payroll tax and withholding the right amount can be an arduous process that incurs errors. By outsourcing your payroll to an online payroll service, the system ensures the correct amounts of tax are calculated and paid. Outsourced payroll services are better equipped to calculate deductions and removes your risk of employee error.
- Generate specific reports automatically
You don’t have to wait for somebody to fill out spreadsheets to generate your tax reports; they’re accessible to you with the click of a button.
Outsourcing Payroll Cons
- You can’t use an overseas provider
If you outsource with an overseas company, they may produce errors due to different payroll tax processes and regulations. This means your options of payroll outsourcing services are limited to the country that you live in.
- You can oversubscribe on outsourced services
Companies often subscribe to a whole range of outsourced processes when they only require payroll. All-inclusive packages can be beneficial, but you must ensure you aren’t paying for a service that you don’t need.
When should you outsource your payroll?
If you’re based in Australia, have 5 or more employees and are committed to maximising your ROI then you should consider outsourcing your payroll tasks to a payroll system in Melbourne. It will work out cheaper for your company so you have more resources to invest in growth, and the assurance that your payroll and tax obligations are being handled by qualified and experienced professionals.
Do the pros of outsourcing outweigh the cons for your business?
i3Group offers a fully managed end-to-end payroll solution in Melbourne and Australia that replaces your need to complete in-house payroll. Your solution is customised to your business needs with a commitment to providing superior customer service.