In-house payroll processing involves hiring a team that will work on-site, buying and maintaining payroll software, as well as overseeing a payroll department. This can quickly become too costly and time-consuming, most especially for small businesses. By outsourcing all the payroll duties of your company to a specialized firm, you will be able to save your business both time and money, which are incredibly valuable resources. The average cost for payroll processing will depend on the needs of your company in relation to payroll.
Payroll Processing in UAE: Basic Costs
Companies that specialize in processing company payroll, in general, charge a basic fee. The basic package fee typically includes online access for all employees and administration, paycheck processing, providing reports every pay period on payroll processing, and direct deposit. In order to determine the cost for payroll processing, your company should examine how often it pays employees, the state of residence, the number of employees, and the payroll complexity or complexity of computations.
A small business that has ten to twenty employees pay more in comparison to bigger businesses per employee as payroll companies provide discounts to the processing of a larger number of employees.
Paycheck Delivery Service
If the payroll company sends paychecks every single payday, then delivery charges can apply. The cost will depend on how the delivery was made. For instance, there will be no charge for standard ground delivery, but fees may apply with next day delivery depending on the location and courier company.
Additional Payroll Costs
Extra fees may be encountered by businesses as there are costs that involve check signing, direct deposit, new-employee reporting, and check envelope stuffing. If the basic cost already covers a certain number for employee payroll processing, then additional employees will entail extra fees. You may need to pay extra if the payroll firm you outsourced needs to make adjustments to company payroll on your behalf like issuing emergency paychecks.
Savings of Businesses for Outsourcing Payroll Management
Outsourcing payroll is not the best solution in certain situations; however, there are benefits that make it worth your time to consider. Not only does outsourcing payroll able to reduce your inhouse payroll processing costs, as well as increase security and accuracy, a business can benefit from the shifting of limited HR resources onto recruiting efforts, training, and operational business functions.
In addition to the improved compliance and enhanced security, there are massive savings businesses are able to take advantage of. These three savings are as follows:
If a business were to conduct a more in-depth analysis of costs, it will find that it is able to realize a significant amount of savings in real money through outsourcing the function. Apart from the reduction in overhead costs, there are a lot of savings that can be gained which would have been spent on training a team of payroll employees, support costs as well as software costs. This does not include compliance expenditures.
By relieving management team of work that’s incredibly time consuming, it is able to improve overall productivity. As payroll processing is being taken care of professionals who are all experienced in the industry, the company is able to release a significant number of hours which HR staff may use in engaging in tasks which provide long-term advantages to the business. Minimizing payroll processing functions (including reporting) from an overworked staff will most definitely help in eliminating stress, as well as employee burnout.
As we’ve noted already, what is converted into money is time. Time savings is the other side of savings in cost. The average time that is spend in the processing of company payroll for at least fifty people is eighteen percent each month as reported by studies. That can be likened to having a full-time individual processing payroll each pay period for almost two hundred fifty employees. That does not include the management of ongoing changes to company payroll, compliance, administrating benefits to employees, and other tasks that are related to payroll accounting.
Fines and Penalties
Payroll processing accuracy allows you in saving significant amounts of resources as you avoid payroll penalties. The local authorities fine all types of businesses in the region and let them pay penalties for miscalculating withholdings, making incorrect filings, and failing to deposit mandatory withholdings. Making even the smallest of mistakes as you calculate the payroll of your company may lead to fines and penalties.
Regardless of the kind of payroll management solution your business uses, there is a need in double checking the numbers in order to ensure that you are not incurring payroll penalties. Also, this is where it is important that you only outsource payroll processing to reliable and experienced service providers.
If you want to rid your company of the HR function that’s better off outsourced to professionals, reach out to a reputable and established payroll outsourcing firm as they will be able to provide you with the assistance you need in meeting all your business’ payroll needs and requirements.
What’s an Efficient Processing of Payroll?
Efficient processing of payroll refers to outsourcing the task of administrating financial records of employees including wages, deductions, bonuses, salaries, and net pay. Efficient processing of payroll also involves proper maintenance of all records related to the company payroll.
What is the net pay?
Net pay is an amount that is paid or issued to an employee as soon as deductions are taken out of the gross pay of the individual.
Is it best to Outsource Payroll processing?
Regardless of whether you are running a small or medium-sized enterprise or large corporation, it is best to outsource processing of payroll to reputable specialized firms. Ideally, payroll outsourcing achieves these main goals: aid you in reducing risks and costs; offer you access to expertise of experts in performing crucial activities related to payroll; and free up resources and time to focus on the core activities of a business.