The Difference Between Full-Service Payroll vs. In-House Payroll
Many small to mid-sized companies handle their payroll in-house. When budgets are tight and the employee roster is small, business owners often want to save the money they would otherwise spend on a payroll service. While this might prove to be a smart choice for some businesses, for others, the time spent on payroll matters is as good as money lost, money they might as well have spent hiring a service. Each company ultimately needs to make its own decision regarding what serves its best interests. To make such a decision regarding payroll, it is imperative to understand the most important differences between full-service and in-house payroll options.
As the name suggests, in-house means that the company handles all payroll matters on its own. Timesheets, wage-calculation, cutting checks, direct deposits – an in-house payroll person or team manages all of this and more. The upsides to this include: 1) Someone already on the payroll completes these tasks; therefore, the business accrues no additional expenses. 2) The payroll process is customized to the business’s preferences. Everything from the software used to the organizational methods implemented for records and documents are decided by the company.
While the benefits of handling payroll in-house can be appealing, there are some significant downsides. Simply put, in-house payrolls teams make more errors than full-service payroll companies. Often enough, business owners (or someone they appoint) will take on the burden of learning how to manage payroll without having any prior experience with the job. This can lead to errors that not only lead to employee dissatisfaction but even fines from the IRS due to failure to comply with all relevant tax laws. To avoid such issues, a company either hires an employee with the necessary training to handle payroll—an added expense—or they use that money to hire a full-service payroll team.
Employing a full-service payroll company like LCAF Payroll means the timesheets, the wage-calculations, the checks, the direct deposits and the tax compliance are all taken care of for your business. No errors, no failures to comply with tax laws, no fines. Every possible headache payroll can generate is suddenly eliminated. With payroll out of the picture, your company and its leaders have more time to focus on the most important things: improving your business and growing your bottom line.
Whether you’re a small, medium or large business, the time and grief saved by outsourcing your payroll needs almost always outweigh the cost of the service itself.
At LCAF Payroll, we offer premium, high-quality full-service payroll options for our clients. To learn more about our services, contact us today.