Thursday, February 02, 2012
Payroll. The Hollywood image of an unobtrusive character in the back room poring over figures may come to mind but that’s so last century. Today, businesses don’t have the luxury of dedicating large chunks of time and other resources to getting employees paid accurately and on time and to complying with the myriad regulations associated with payroll. Indeed, payroll, though an essential element in operating any business, must proceed transparently freeing owners, managers and other employees to get on with the business of business.
Below are some of the best reasons to consider using an online payroll service:
Save Time and Money - In business, time is money and running payroll can’t be a full time job. It’s an overhead expense that doesn’t directly add to the business’ bottom line and it is one of the most commonly outsourced functions. While employing an accounting firm or more traditional payroll outsourcer may be beyond the reach of many small businesses, online payroll services provide a critical array of services at rather nominal prices.
Ease of Use - Processing payroll is regarded as a rather arduous task by most business operators but inputting data into an online payroll service is intuitive, quick and easy. The initial setup is critical because future calculations are based on it, but online payroll service providers have made the process about as simple as one could imagine. What’s more, they generally provide support to assist in getting things set up right initially as well as resolving any problems that may arise.
Avoid Costly Errors - Getting it right the first time is a major advantage that online payroll services provide. In addition to making data entry simple, they generally present a completed payroll for review before live submission. The services also use their expertise and systemization to make certain that all payroll tax reporting and payments are made accurately and on time thus avoiding costly penalties.
Stay Current - A major complaint of business operators is always that there’s too much government regulation and that they are often not aware of changes as they occur. Keeping up to date on applicable regulations from the multiple levels of taxing authorities is at the heart of an online payroll services business so that their clients are liberated from the need to be payroll experts and can concentrate on running their businesses.
Online Payroll Services: What to Look For
We don’t want to place any more emphasis on the price of an online payroll service than is absolutely necessary, but the reality is that the cost of the service is one of the most significant distinguishing factors. The reporting and deposit requirements that an online payroll service must meet are, for the most part, statutory in nature and the features that are offered from one service to the next don’t vary greatly. These facts result in price being an important factor in choosing a provider. When comparing prices of the various providers, don’t forget to consider those features that some companies include in their overall service while others impose additional fees.
Ease of Use
Of course you should consider ease of use. But online software and services are now almost universally conforming to best practices when it comes to user interfaces. So unless you encounter a design that happens to annoy you, ease of use is not the most important feature to examine.
If you have less than 150 employees, you might prefer the ability to print checks locally. Some online payroll services let you print checks and paystubs locally, but some offer centrally printed checks only. Direct deposit is a standard feature, but some vendors include it in the monthly fee and others charge more for the feature.
These days, most employees receive their pay via direct deposit to a bank account but some still find the option of getting a paper check preferable. Payroll cards are becoming more popular, particularly for employees who don’t have a bank account. These are essentially debit cards that can be used to make purchases as well as to make cash withdrawals.
Tax Compliance Features
When thinking of payroll processing, the first thing that comes to mind is likely to be getting employees paid. But for employers, the biggest problems associated with payroll involve compliance with a multitude of tax regulations. An online payroll service can file the quarterly and annual returns that are required by the various levels of taxing authorities and make the mandatory periodic deposits. Most offer the option of doing the filings on behalf of the client or of providing ready for signature documents that the customer then files.
Help & Support
In a competitive industry in which everybody provides services that strongly resemble one another, customer service is deciding factor. Payroll issues are usually time sensitive and missed deadlines are costly. While many online payroll service providers guarantee timeliness and accuracy, the business operator always deserves and should insist upon superb customer support.
The data entered into an online payroll service can generally be exported to other accounting software. Some services allow for integration with multiple software packages, while others only support the use of one or two. The important point is that the data should be compatible with the accounting software used by your business. An online payroll service should make running a business easier and more productive rather than requiring duplicate data entry or a complete changeover of accounting software.
We’ve taken care to evaluate online payroll services with the needs of small businesses in mind. As you compare services on our side-by-side matrix, take note of those characteristics that are best for a small business.
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