When you own a business, you tend to forget to pay yourself. You’re so busy trying to grow the business and reinvest in it that your own paycheck can get “lost in the mail.”
But when you start hiring employees, or even independent contractors, it might make sense to invest in a payroll service. It takes some of the bookkeeping off your plate and ensures that those you’re paying get paid on time.
It’s tempting to find the least expensive service and dive in, but it really is true that you get what you pay for. You’ll want to do your research and make sure that the service you use offers the support and features you need.
Benefits of a Payroll Service
A payroll service can do much more than simply send out the paychecks on time. It will also help you set up guidelines that differentiate an employee from a contractor or temporary worker, while meeting the rules for withholding and other deductions. Most services will also help you determine payroll taxes and send out W-2 forms at the end of each tax year.
Some bookkeepers and accountants also offer payroll as an add-on service if they’re already doing your taxes or keeping your books.
What to Consider
Price aside, you need to make a decision about a payroll service based on the service’s support, accuracy, programs used and compatibility with the software you already use (or the ability to assist you in switching to a compatible software). In the interest of saving time and money, it should also be simple to use for you and any employees or contractors you’ve hired.
Another consideration is the add-on services that the company provides. Some allow you to loop benefits enrollment and time tracking into your payroll system, making it easy for the service to become a one-stop human resources shop.
What Will It Cost?
Prices vary widely from provider to provider and depends on the specific options that you need with your payroll services. But compared to hiring an in-house bookkeeper or doing it yourself, the pricing and time commitment is nominal.
When you’re comparing prices, you’ll want to know how many checks you need issued each month and how the service charges for additional tax forms and changes to employee information.
Where Do I Go?
There are more payroll services out there than I could possibly include here, and they are all over the place when it comes to offerings. However, these are some of the services that my clients have used in the past. You will need to do your research to find the service that is right for your business.
- Intuit (QuickBooks Payroll) – An industry standard, even the basic service includes features like direct deposit and worker’s compensation. All levels of service currently come with support, which is a big bonus.
- ADP Run – A great small business solution, this service has more limited function than its bigger brother, ADP. There are three tiers of offering and an a la carte selection of add-ons.
- Paychex – Doing your payroll at 2 a.m. is no problem here, with 24/7 support. Beyond payroll, you can also use HR services such as COBRA administration, employee background screenin and other add-ons.
- Gusto – This is my personal favorite, and it integrates with Xero and QuickBooks for a seamless payroll experience. You can even let payroll run itself, which frees up even more time for you to run your business.
Like any outsourcing solution, there are things to consider when looking for payroll services. If you’re not sure what you need, talk to your CPA, accountant or bookkeeper. They’ll know enough about your books to help you make an informed decision—and might even be able to take payroll off your plate for you!