When attempting to keep costs down and profits up, it is not uncommon for smaller business owners to take certain tasks into their own hands to retain what it would cost to pay a professional to do it.
One such task is doing the payroll.
Rather than hiring a payroll service, many business owners try to do this job on their own believing that it is not that difficult.
Handling Payroll is Quite Complex
The truth of the matter is that handling the payroll is a lot more complex than it seems.
Mistakes made in tax filings, payroll deductions, and other legal payroll issues can create more headaches for business owners and employees both than if the job was left to a bookkeeping service.
Professional accountants trained in how to handle all payroll needs quickly pay for themselves by avoiding the costly mistakes that untrained staff, even the boss, can make.
Why Is Doing Payroll So Complex?
Payroll calculations involve much more than simply multiplying employee hours worked by the pay rate and then cutting a check or approving a direct deposit.
Done correctly and legally, the person handling the payroll must also make critical tax deductions for the employee, deposit those deductions to the IRS in a timely manner, and stay on top of the very tax laws that those decisions revolve around.
This includes making deductions for local, state, and federal taxes where required, making the appropriate social security deductions, handling employee healthcare pre-tax deductions, 401(k) deductions, and any other tax or payroll details required.
Any failure to make correct deductions or report income and taxes correctly can create legal problems for both the business and the employee.
Hire A Qualified Bookkeeping Service!
Instead of dealing with the headaches and potential repercussions should payroll and tax mistakes be made, it is highly advisable that small business owners instead find a qualified bookkeeping service to handle their payroll needs.
Although it may seem like an unnecessary expense to add and that it can’t possibly be that difficult to od the deductions, all it takes is one mistake to end up spending hours dealing with the IRS, paying unnecessary fines, or even needing to hire a lawyer in a worst-case scenario.
Hiring a payroll service is a critical business expense that should always be budgeted in as one of those “must-haves” to ensure your business is running legally, your employees are paid correctly, and you really can keep all the profits without ending up paying out to resolve preventable payroll problems!