Payroll – An On-going Struggle?
Whether you’re a small business or a larger business, administering payroll can be a time-consuming and complex process. Historically, payroll has been perceived as a data-processing function. However, due to the ever-changing complexities of taxation, pensions auto-enrolment, employment and data protection legislation, payroll has evolved into much more and has become an integral function of many businesses.
As a business owner, keeping up to date and compliant can prove increasingly difficult for employers. The last 12 months alone has seen the introduction of the Apprenticeship Levy, increases in the National Minimum Wage (NMW), National Living Wage (NLW) and changes to the salary sacrifice scheme introduced in the latest budget.
The main benefits of an outsourced payroll function include:
1.Staff cover – mitigates issues when payroll staff are on annual leave or off work due to illness, as the payroll function will operate regardless when outsourced.
2.Experienced and well-trained staff – mitigates the requirement to train staff and keep up-to-date with legislative changes, employment taxes and so on.
3.Free-up time – for many small businesses in particular, outsourcing the payroll function will free-up staff time to focus on other aspects of the business.
4.Cost savings – maintaining payroll software and ensuring staff are appropriately trained can be costly and is an on-going investment in order to keep up-to-date. Outsourcing payroll eliminates this burden and can reduce overall costs.
5.Avoid penalties – there has been increasing coverage in the national press of companies being fined for payroll non-compliance, in particular failure to pay staff the NMW and NLW. Outsourcing payroll eliminates the risk of penalties being imposed.
6.Avoid technology headaches – payroll software is required to be updated on a regular basis and failure to do so could result in incorrect deductions being taken from employees and inaccurate information submitted to HM Revenue & Customs.
An outsourced payroll function can also provide additional services including Construction Industry Scheme compliance, auto-enrolment administration, dealing with HM Revenue & Customs enquiries, systems training and other advisory services.
If you have any questions about the above or would like to know more about out-sourcing your payroll, don’t hesitate to get in touch with a member of our team.