For many companies, the department that handles processing payroll does a lot more than hand out cheques. Many small businesses hire payroll service companies to handle a plethora of human resources tasks such as calculating payroll taxes, filing and preparing tax documents and conducting thorough analysis of how much each employee contributes to the business’s bottom line. The payroll for small companies is often very complicated and many firms with fewer than 50 employees find outside help such as a payroll provider to handle this duties.
The 4 Benefits of Outsourcing Payroll Systems:
- Companies can avoid problems with the federal government. In Canada, the government has found that small businesses make up a lot of the unpaid taxes so now they are cracking down on tax code violations. This is one reason many companies look hire a payroll provider to make sure they are complying with the tax laws. It is much cheaper to have an outside firm handle payroll systems than to have to pay the fines and fees associated with non-compliance. Also the rules and regulations imposed on businesses do change all of the time. Keeping up with the changes takes a lot of time and effort. Hiring a payroll services firm can save your business a lot of stress.
- Doing business in Canada can be hard for foreign companies. International firms who do business in Canada hire payroll serviced providers to make sure they comply with the payroll laws and regulations. American companies often hesitate to open branches in Canada because of the onerous regulations they face. They benefit from hiring payroll experts in Canada rather than trying to do all of that on their own. If your business has a small office in Canada, it still has to follow the rules and regulations for staff working in that country. For these situations, it makes even more sense to outsource payroll services rather than do it in house. The Canada Revenue Agency (CRA) has very complicated regulations for employees and unless your firm has experts already on staff, it may be in your best interests to hire a payroll provider to help.
- Companies can save money by outsourcing their payroll operations. Hiring a payroll provider is most cost effective than hiring people to do these tasks in house. For many companies, it makes more sense to hire an outsourced payroll service to handle these issues rather than hire several, dedicated full time staff members. Rather than search for, hire and then train new employees, a firm can hire a good payroll provider to handle all aspects of payroll processing. Plus, you pay just for the services you need. Once your contract with the payroll service company is over, that is it. You do to have to worry about unemployment or other issues that you have to worry about when you lay people off.
- Hiring a payroll provider will save your human resources department time. Processing payroll can take a lot of time. This is time your staff could be spending doing something more germane to your business. If you do not have a department whose only role is processing payroll, this can become a drain on the productivity of the entire company. You can free up these workers to do what you hired them to do by outsourcing your payroll needs.
It is often easy to think of the payroll department as having one real job, they distribute pay cheques. This could not be farther from the truth. The payroll rules and regulations are very complicated and heavily enforced. Many companies who had no intention of violating anything have been found to have problems with the taxes they filed. Hiring a payroll provider who has experts in all of the CRA rules can provide you with a peace of mind and the security in knowing your company will not be liable for the hefty fees and fines associated with non-compliance. It is much cheaper to hire a payroll processing company than to make mistakes while filing payroll taxes.