Why Outsourcing Payroll is a Smart Business Decision

Payroll Outsourcing

The goal of any business, be it small, medium, or large in size, is to make more money than it spends. For this reason many organizations, especially small businesses, attempt to complete as much as they can in-house. But while doing it in-house they don’t take into account the hidden costs or opportunity costs. The cost of operating and integrating interdependent processes & the different functions are usually not taken into account.

Payroll processing is one of the most important challenges for any organization, and no business owner can afford to go wrong on. Companies often struggle with the payroll burden with employing a few people juggling their time between many duties.

Payroll is a complex process to handle. Take an example of a construction company, more often than not, employees don’t work in one location, and most workers are not paid straight salaries every couple weeks. Instead, contractors must deal with unique complications such as shifting pay rates, multi-state and local taxes, unions, workers’ compensation and cert.ified payroll, just to name a few.

While doing in-house payroll many business owners underestimate the cost of processing payroll internally by failing to account for all hours spent and resources allocated to pay employees and maintain payroll paperwork. Thus payroll outsourcing decision can be a boon for the company and help them to concentrate on their core business while outsourcing company will handle all the payroll related work

Why payroll outsourcing is a smart business decision ?


Most businesses can save money by outsourcing payroll administration and also the cost of printing and distributing cheques, creating tax documents, and bookkeeping.


Getting payroll outsourced frees up internal staff to focus on higher-value pursuits that develop the business. Small-business entrepreneurs especially appreciate the freedom to focus on what matters most for their business.


Payroll comes with implied rules and regulations by government. Outsourcing the payroll function typically shifts responsibility onto the payroll service provider. Most payroll outsourcing companies back their work with a guarantee. They are more accountable towards their work as it is one of the main reasons behind continuous engagement with clients.

Statutory Compliance:

A payroll service provider has the expertise and resources to manage complex payroll accurately. With respect to legal compliance, they are able to keep pace with complicated, changing legislation and tax obligations associated with payroll.

Better Service:

Payroll service providers have an obvious advantage over an internal team in providing quality service. Again, important factors such as access to latest payroll technology, expertise, regulations and volume of payroll calculations matter here.

Professional payroll companies allow businesses to save money and improve productivity. More and more companies are relying on payroll outsourcing to shoulder the administrative burden of managing and maintaining complex payroll, tax calculations and compliances. For most businesses, putting payroll in the hands of experts is not only a relief but it’s also a smart business decision.

To know how Paysquare can help to manage your Payroll process, please contact us today! Free consultation