Payroll is vital, but surprisingly, processing it under your own roof could cost more than you know. Here are the 5 biggest things to be wary of if you’re doing it yourself.
1) Lack of Support
Yes, payroll programs like QuickBooks have help files to sort you out when you did something wrong, but the truth is that you don’t have a lot of professional support. That means you could be making these errors for weeks or years and not even notice until it’s time to tally everything up at the end of the fiscal year – fixing this mess could take weeks.
This lack of support isn’t limited to the payroll system. As we’ll discuss in #4, payroll often includes surprises that you won’t have much help in finding answers for.
2) Taxes
The tax codes for business are complicated, so it’s easy to get them wrong – and messing up on taxes is what those of us in business refer to as a “Bad Thing”. You don’t want to get audited or suddenly find yourself with a bill for thousands of dollars you’d rather spent elsewhere, and most importantly, you don’t want to come up short on funds to pay your employees.
Remember, it only takes one mistake to get you in serious trouble with the government. The idea is to do everything right the first time and keep yourself in good standing.
3) Multi-State Issues
Having locations in more than one state is the dream of many small businesses, but different payroll rules in each area can quickly become a nightmare for an in-house team. This is especially true when you have to consider various exceptions to rules, and ongoing policy and legislative changes.
4) Surprises on Timesheets
Surprises are a fact of life, and that’s a concept we all might as well get comfy with. The problem is that processing payroll alone means you’ll have to constantly allot time to study up on these things and figure out what they mean and how they affect you.
Some of these surprises can’t be researched very easily. You may find yourself seeking out an expert, and that can get expensive and cause delays.
5) Loss of Trust
Nothing will turn your employees away from you faster than mismanaging their money. Honestly, who could blame them? After all, they’ve upheld their end of the deal. How will you manage if they leave?
That’s part of what managing things is about, and all with integrity and legality top of mind.
Finally, regardless of whether you’re doing payroll by yourself or partnering with a company that can take it off your shoulders, the info you collect has to be accurate and complete. This doesn’t just mean the entry-level employees, managers also need to understand the payroll process, including how and when to get things submitted. Even the pros need time to ensure seamless transactions.
Doing payroll yourself can seem temptin, “saving money” you’d like to invest into other parts of your business, but that attraction is deceptive. Problems with payroll can destroy your company, so if it feels like too much for you to handle, it’s time to look into hiring a third-party to manage it for you. Your company is worth it, make the call as soon as possible so you can have peace of mind.