The payroll is an essential account for all businesses, whether big or small and new or old. Remember, your employees are your best assets that ensure seamless business operations. Without them, you will struggle running your business, addressing client concerns, and even making money. Thus, you need an accurate payroll, which is the complete list of all the employees and their corresponding salaries that a company needs to compensate. In addition, keeping track of this account ensures that you can prepare paychecks and have them ready for release on time come payday.
Preparing the payroll may seem like an easy task, but it is a lot more difficult than it seems. You will have to calculate salary rates based on hours rendered, including holiday pay, overtime, and night differential rates. In addition, leaves, days off, benefits, and withholding taxes must be calculated as well. While these things seem simple, it is important to note that preparation of the payroll also requires a lot of legal knowledge on matters of social benefits, taxation, and even wages.
That is why it is highly recommended for companies to hire professionals to get the job done right. Remember, paying wrongly computed wages can result in issues with the Department of Labor and Employment (*). You could also be overpaying, which adversely impacts your expenses and compounds in the long run to create an even bigger problem. Worst of all, wrong wages will affect employee performance and productivity. If you are not yet sold on the idea of hiring professional payroll services, continue reading below. We have everything covered here to help you see that this expense is well worth it.
1. Assures Easy Scheduling, Printing, and Distribution of Paychecks
Payroll services will help you create a schedule that ensures your employees get paid on time and are compensated the correct amount. This ensures that you won’t have to face labor charges for delayed payment of salary, employee neglect, or other violations of wages and labor codes. In addition, your payroll services provider will also shoulder the responsibility of printing the payslips, transferring the right amount to the accounts of the corresponding employee, and accounting for these expenses in your records. This is especially beneficial if you run a business with a lot of staff on the roster.
2. Results in Accurate Calculation Payments and Benefit Deductions
Different pay rates are used based on the skill of the person and the number of hours rendered. Therefore, it is important to take note of base wages as well as paid or unpaid leaves and days-off. Moreover, overtime calculations, double pay, and holiday pay are entirely different from the calculation of base wages. Your payroll services team will do all the number crunching for you. They will also calculate benefits deductions of employees on your behalf to ensure you remit the correct amounts. Remember, a well-paid and satisfied team with all the right benefits will work optimally.
3. Provides Expert Tax Administration and Legal Knowledge
A professional payroll service will take care of tax calculations. This can be particularly tricky for you to do on your own as tax rates can vary, depending on the regulations and circulars released and updated by the BIR. Moreover, different laws are factored into the calculation of withholding taxes.
4. Helps You Avoid Stiff Penalties
As previously mentioned, hiring a team or outsourcing payroll services ensures that your employees get paid the right amount and through the right means. They will also ensure you do not fall short on calculations of taxes, which can be a grave mistake as it involves the BIR. You may incur penalties or get your business license revoked. Worst of all, addressing a case filed against you with the DOLE is time-consuming and costs money, too.
5. Frees Up Time So You Can Focus On Other Business Responsibilities
The biggest advantage of hiring a payroll service is the alleviation of a taxing responsibility (pun intended). If math is not your forte, it is easy to make mistakes. Besides, what a professional can do in a few minutes may take you days. Thus, investing on this service frees up your time, allowing you to focus on more important aspects of your business, such as operations, management functions, advertising and marketing functions, and supply chain management. You can even engage in product development and assure better customer care to assure better sales and profits. Sometimes, paying for convenience will even earn you a lot more money in the long run.
The Final Word
Payroll services may be an additional cost, but like all other businesses expenses like accounting or bookkeeping retainers, you stand to gain a lot more value from it. Running a business is a hard enough job in itself. Hiring a professional will do wonders for your company and you, and that’s what makes it SO WORTH IT. If you need assistance with your company’s payroll, give us a call. We offer free 30-minute consultations.