Payroll Myths: BUSTED

7th September 2016

This week is National Payroll Week, a week where we raise awareness about the payroll. Before you dismiss the idea of outsourcing your payroll as too expensive, too complex, or too much hassle, make sure you know the facts.

There’s Only One Kind Of Outsourcing

Outsourcing just means you shift all the work from one department to a third party, right? Wrong! There are many kinds of outsourced payroll service that can be broken down into 3 categories:

  • Fully Managed Payroll

A managed payroll service involves outsourcing every aspect of your payroll to a third party – including data entry and running reports. This means that, apart from collecting payroll data internally and passing it to your payroll business services provider, you have nothing else to do.

  • Part-Managed Payroll

Part-Managed Payroll does what you might expect: It divides the work between the provider and the customer. The division of labour is worked out between each party, depending on what the customer needs.

  • Bureau Service Payroll

By contrast, a payroll bureau service involves outsourcing the processing part of the payroll function, while keeping data entry and reporting in-house. This means that internal staff will enter payroll data directly into the payroll service provider software and run reports themselves as needed. The provider then arranges for the data to be processed and payslips produced.

I’ll Have No Control Over My Payroll

As above, you don’t need to give up all your payroll aspects if you don’t want to. Just talk to your provider and keep the parts you want to keep. You can always renegotiate later.

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Outsourcing Payroll Is A “Set & Forget” Service

The best outsourced service providers act in partnership with their customers. While perfectly happy to just do a job, the best service providers actively work in partnership with you to help support business growth and strive to continue to meet your needs.

Handling Payroll In-House Is More Cost-Effective

As we mentioned in our previous blog, there are many frustrations associated with in-house payroll, particularly for small businesses. Every frustration, error or delay costs money that a professional service provider will not make. In addition, staffing, training and purchasing software are just some of the ground floor costs to doing payroll in-house.

My Business Is Too Small For Outsourced Payroll

If you’ve only got a few staff you could probably make more money making money, instead of managing your payroll and tax obligations. Freeing up time makes you more efficient and more profitable. For businesses with staff numbers of more than one, outsourcing payroll is a must.


My Employees’ Personal Data Will Be At Risk

Reliable and professional outsourcing services should be fully accredited and be trusted partners of other businesses. Data loss puts everyone at risk and outsourced payroll companies work hard to ensure that they have the systems in place to maintain maximum security. Look for ISO 27001 and other accreditations.