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Engage PEO is a US-based professional employer organization that utilizes cloud technology along with the legal expertise of an HR service team to provide outsourcing solutions for small to mid-size businesses. Engage PEO provides...Read more
Execupay is a technology-enabled HR solution offering payroll, background check, and benefits management services for small to midsize businesses across many industries. Execupay's customer service team can assist HR managers with...Read more
Paychex Flex is a human capital management solution that's designed using web-based modular technology and a dedicated service center to help meet the HR needs of employers of any size and industry. With a single login, users can ...Read more
Dayforce, provided by Ceridian, is a solution for payroll, benefits, workforce management, human resources, talent management, document management, and analytics. As a single application, Dayforce provides organizations with acces...Read more
AsureHCM is a human capital management solution that brings together cloud-based technology and on-demand HR services for small to midsize businesses. The HCM platform provides businesses with payroll and tax solutions, benefits a...Read more
Insperity Recruiting Services is a technology-enabled solution offering recruiting services to businesses of all sizes. Insperity's team of recruiters and consultants are available to help businesses plan recruiting structures, in...Read more
Harvard PEO is technology-enabled service provider that works with employers with over 75 full-time W-2 employees. Harvard PEO provides high-level experienced human resource professionals including an Attorney to take care of all ...Read more
ADP TotalSource is a full-service HR solution for SMBs. It provides cloud-based HR technology paired with a team of experts to help businesses handle payroll, employment tax, employee benefits and benefits administration, HR polic...Read more
Evolve HCM is a SaaS human resource and payroll solution for small to medium-sized cannabis employers. Our product is a fully integrated, fully mobile enabled, full suite human resources application which includes: Recruitment, On...Read more
Payroll compliance is complex, especially for small and midsize businesses (SMBs). There are many things to consider:
According to Inc.com, about 40% of SMBs incur IRS penalties, costing them an average of $850 per year. A payroll service can help you manage payroll compliance more efficiently, thereby helping you avoid these fines. The service also saves time spent with payroll processing and ensures that all your employees receive their paycheck on time.
However, because of the sheer number of payroll providers, finding the right service for your business can be confusing. That's why we've created this guide with all the necessary information you'll need for selecting the best payroll service for your business.
In this guide, we'll cover:
Payroll services allow businesses to outsource their payroll management processes. Such services help businesses track employee time and attendance, calculate salaries, compute taxes, and remit salaries to employee bank accounts. Some services also perform tax filing on behalf of your business.
The first step towards selecting the right payroll service for your business is to understand what is offered with this type of service. According to our research, the following are the features you should be aware of:
Payroll run |
Calculates net pay and delivers salaries to individual employee bank accounts on the designated date. |
Compliance management |
Ensures that the business' payroll practices adhere to compliance standards, such as the Labor Welfare Fund (LWF), Employee State Insurance (ESI), Professional Tax (PT), and Provident Fund (PF). |
Tax management |
Calculates local taxes, state taxes, and federal taxes applicable to employee payroll. Some services also file taxes on behalf of your business. |
Time tracking |
Records employee time worked to calculate the salaries based on hourly wages. This functionality also helps payroll service providers to manage labor and overtime pay compliance. |
Employee self-service |
Provides your employees with an online portal or mobile app where they can access their payroll information. |
W-2 and 1099 support |
Generates W-2 and 1099 forms using the payroll data. |
Reporting |
Provides you with reports on different metrics such as employee payroll, payroll costs, and taxes. |
The next step is to understand the types of clients that use payroll services. This knowledge will help you select a product based on your business requirements.
The following are different types of clients of which to be aware:
After you've learned about the common features, the next step is to understand the advantages of using a payroll service. Knowledge of benefits will help you assess the usefulness of a payroll service for your business, which will help you build a strong case for the investment.
Here are the key benefits of payroll services:
Easier compliance tracking. Payroll service providers keep a close watch on tax, payroll, and labor compliance. They ensure that the payroll taxes are accurately calculated, overtime pay is factored into payroll calculations, and employee pay and benefits are in compliance with government regulations.
Increased business profits. Using a payroll service helps you avoid possible costly IRS fines, thereby contributing to your business profits. Outsourcing the payroll process can also help you minimize or completely eliminate your payroll staff, resulting in reduced costs.
However, despite these benefits, there are some potential issues that you need to factor in while selecting a payroll service:
The landscape of payroll services is changing fast. As a result, to ensure long-term success with your payroll service provider, you need to select services that are incorporating the recent market trends into their offerings.
Here are the key market trends that you should know about for payroll services: