August 20, 2015
Do you know that one in every three businesses gets penalized by IRS for errors in payroll? Delegating important but time-consuming payroll tasks to a third party can give enormous boost to your business as you will be spending more time on important and strategic activities. Many business owners save time, effort and prevent costly errors by outsourcing their small business payroll services.
A good payroll service provider will not only make sure that your employees are paid on time but also files your payroll tax files on time so that your business is in compliant with the statutory laws at any given point of time.
There are hundreds of payroll service providers in each city in US. Just check for payroll service providers in Yelp for Miami city. You will get more than 150 results. Not all payroll service providers are created equal. But how to decide which payroll service provider is good and is a right fit for your business? Here are some key things you need to consider while choosing a payroll service provider.
Should you choose big company?
There are some big companies offering payroll services like ADP and Intuit Online Payroll. They generally bundle their payroll service with additional services which your business may not need. This could make your outsourced payroll services costlier and in most cases unaffordable.
When choosing a payroll service provider check for their integrity, response time and professionalism. You can get these details by speaking to some of their existing clients. Also check if they guarantee their work – are they ready to take the costs if they make any mistakes in the payroll processing.
One thing you need to understand here is everyone makes mistakes. Even the best service providers can make mistakes. It’s not that they have to pay for the mistakes; it’s about how accountable they are. Check how quickly they take steps to correct the mistake.
Good customer service is a key differentiator of a good company from a bad one. You don’t want to deal with a new person, not familiar with your account, every time you interact with them. Also since payroll is an important aspect of running a business, you want to talk to a live person who is ready to help you. Companies that understand the importance of having a person available can be considered a good.
Services they provide
Before you start looking for someone to help with your payroll services, list out all the services you may require. Check if the potential service provider offers all the services you require. Check if your provider can take care of various state and federal tax obligations.
Some of the common services provided by decent companies include:
- Individual tax and salary calculations
- Print, deliver, and direct deposit
- Payroll tax payment and filing
- Handle new employee reporting
- Deduct benefits, including health and insurance benefits
- Deduct 401(k), Individual Retirement Account (IRA), Flexible Spending Account (FSA), and Health Savings Account (HSA) contributions
- Handle various earnings and deductions
Serving businesses with payroll services for a longer period of time indicates that they are stable with their services. Check if they have a good track record of offering services that meet the specific requirements of your industry. There are some who specialize in multiple industries such as medical practices, construction, automobile, recycling/manufacturing companies, restaurants and more.
See to it that the service provider offers easy-to-use technology that is accessible 24/7. Also check if you can access the payroll software using your smartphone or tablet. Check if the provider offers a web based payroll system that enables your employees to access their personal payroll history, and benefits information on their own.
Now that your company’s sensitive and crucial information is in some third party’s hand, you have to make sure that they are keeping their data safe using highest encryption standards.
As yours is a small business running on a tight cash flow, you need someone who is transparent in pricing. Check their pricing structure, including supplemental charges for adding new employees, upfront to avoid any future issues.