How to Choose a Payroll Service for Your Business
What Does a Payroll Service Do?
A payroll service is a very important tool for any business. Essentially it calculates how much each employee worked and the total wage owed amount. These services then subtract all withholdings as well as the deductions. Some services will even automatically make direct deposits and print out or mail checks. Services like these make paying your employees easier than ever. Just 20 years ago a bookkeeper would have to do all of this manually and it would be at the expense of the business owner. Now the internet makes payroll tasks easier than ever and using an online service can save time and money.
Figuring Out Costs
Cost varies in the payroll service business due to the many types of businesses and their needs, employee count and additional services needed. The majority of payroll services have a simple pricing setup. It’s usually a monthly fee as a base, plus an additional amount charged for each employee added to the software. Depending on business size, this number can greatly vary. You will need to do the calculations yourself to find the most affordable service that offers the benefits you need. Some payroll companies may also charge per check or direct deposit sent out and this price can add up if you have a large number of employees.
What to Look for in a Payroll Service
There are several things one should be on the lookout for when choosing a payroll service. The first thing one should do is check for hidden fees. If you go over a specific employee count or add an extra service, you could be paying much more per month. The second thing one should look for is reliability. The software you choose will be responsible for paying your employees and balancing your books. Read reviews to make sure that their calculations are accurate and that other users haven’t had any issues. After all, an issue can mean a visit from the IRS. This is why choosing the right service is important. Not only for cost, but legal factors as well.
Analyzing Your Needs
Every business will have different needs which is why there’s a variety of payroll services. Some business may rely more on cash than others. Thankfully, there are services that can assist with this for cash-based businesses.
Small businesses with only a few employees have different needs, and going for a software designed for small business might be cheaper and more effective for you and your bookkeeper.
If you are running a medium to large company, there are services specifically for you as you may not have as much facetime with all your employees and will have different needs. Due to the large variety of these services, analyzing your needs should be the most important factor in choosing a payroll service for your business.
Additional Bookkeeping and Tax Services
If you are looking for a payroll service managed by a bookkeeper, there will be additional costs associated. Some businesses prefer to have a real person as well as an online service for bookkeeping. These people can file your takes for you and answer any questions that you have regarding your tax records. Some businesses need to file taxes several times a year and this is why this feature can come in handy. Many larger businesses choose this option to have someone they can rely on in confusing situations. There is usually a larger cost associated with this service.
