By Louise McGuire, head of payroll services at RMT Accountants & Business Advisors Ltd in Gosforth
Managing a company’s payroll can be a time consuming and complex process, whether for growing businesses that are taking on more and more staff or smaller firms where the management teams already have enough on their plate with keeping the company’s day-to-day operations on the right track.
It’s therefore no surprise that outsourcing of the payroll function has become an increasingly popular option for North East businesses of all sizes over the last few years, especially where they simply don’t have or can’t afford to have staff with specific expertise in payroll matters in-house.
Outsourcing allows for the management of payments, deductions, tax filing, pension scheme admin and record keeping to be passed to experts who deal with these complex matters on a daily basis, while it also takes care of the business’s time-consuming responsibility for keeping up with the latest complex legislation and regulations that relates to payroll management.
There are strict legal criteria to be met around how this work is carried out, with penalties in place for firms that fail to meet them, while the payroll implications from the way in which furlough payments were made through the Coronavirus Job Retention Scheme during the pandemic are still being played out in many businesses today.
If you’re looking at outsourcing the payroll function for your business, your first step should be to talk to potential providers about the range of services they can provide and the specific requirements of your business, whether this is delivering a full payroll service or managing specific elements of it.
Your existing professional advisors may be able to provide this service themselves via their own in-house resources, or they may be able to recommend specialist businesses that they know and trust to deliver the support you need.
Management data should be just as easily available from an outsourced provider as it is from internal systems, as you don’t want any missing information delaying business decisions that you have to make, so make sure to question them about how you would access it, what sort of payroll software systems they would use and what are the particular advantages of choosing this option.
Issues around data security should also be part of this discussion, as you’ll need to be absolutely certain that any commercially confidential and/ or sensitive information you allow to leave the business is being properly safeguarded.
You should also seek clarity on likely ‘per head’ costs right from the outset, which will of course depend on the exact of services you need and the number of employees they will cover, but should enable you to make savings on managing the process in-house.
In the current challenging economic climate, management teams have more than enough to keep them busy without having to worry about meeting their payroll responsibilities.
Getting expert help with doing so can save substantial amounts of management time, money and worry, and whatever size your business is, it’s something that’s definitely worth considering.
For further information on the benefits and practicalities of payroll outsourcing, please contact Louise McGuire at RMT Accountants & Business Advisors on 0191 256 9500 or via louise.mcguire@r-m-t.co.uk