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The Benefits of Outsourced Payroll Services

Many small businesses take care of their own payroll duties under the illusion that performing payroll tasks in-house will reduce costs. Contrary to this belief, however, outsourcing payroll activities to a third-party service provider can save money, increase productivity, and reduce legal risks. Below, we’ve elaborated on just a few of the benefits of outsourcing your payroll responsibilities to a third-party.

Compliance and accountability

Rules and regulations governing payroll laws can be complicated, and nobody wants trouble with the IRS. Outsourcing your payroll responsibilities allows your company to shift the burden of legal liabilities onto a third-party payroll service. Penalties for violating payroll tax laws can result in steep fines or even jail time. Third-party payroll services typically have the experience and expertise to file payroll taxes and paperwork within full compliance of the law.

Increased savings

Many businesses (especially those with fewer than 20 employees) can save a significant amount of money by shifting their payroll responsibilities to a third-party service. The cost small businesses incur while printing and distributing checks, keeping the books, and creating tax documents is typically greater than the amount they could pay for an outsourced payroll service to perform those same responsibilities.

Efficiency and productivity

Delegating the functions of payroll to another party allows your administrative team to focus on other important tasks within the company. Small businesses especially stand to benefit from focusing employee efforts on growth and productivity.


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