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Manage your services:
By BuyerZone.com Editorial Staff - BuyerZone.com
Payroll Services - a lot for your money
Handling weekly, biweekly, or even monthly payroll is a great example of a task that is easily handled when a company is starting out – but gets exponentially more challenging as you add more employees. Factor in changing employee rosters and hours, tax withholding, W-2s, 401(k)s, and complying with multiple state and federal regulations, and payroll time can change from the most anticipated time of the month to one of the most stressful.
Fortunately, modern payroll service providers are able to take on many of these duties for a surprisingly small fee. Payroll services’ basic duties include calculating paychecks and tax obligations for each employee, printing and delivering checks, and providing management reports. Paychecks can be issued on any schedule you choose, from weekly to twice a month to monthly.
Additional payroll-related services that may cost extra include automatic check signatures, direct deposit, and handling of W-2s. Many payroll services now offer tie-ins with 401(k) and Section 125 mutual fund plans, allowing employees to set up automatic deductions from their paychecks.
For larger companies with more complex processing needs, some payroll providers offer HR software
systems that track employee benefits information in addition to regular payroll data.
Many payroll services offer the option of filing state and federal payroll taxes for your business.
This can be a valuable feature given the fact that the IRS has reported that one out of every
three employers has been charged for a payroll mistake, with total penalties reaching into the
billions of dollars.
How much will it cost?
A basic payroll processing service typically costs $2 to $3 per check, plus a base account fee.
Services such as tax filing and delivery can cost $4 to $9 per payroll period. Add-ons like
direct deposit often carry a nominal per-check charge. For a full-service solution, a small
to medium-sized business can expect to pay a total of $3 to $5 per paycheck issued.
Furthermore, there can be fees for adding or dropping employees, adjusting employee information, or setting up your account. All of these fees can differ dramatically across providers, so make sure you understand which services you want before signing up for it. That way, you can ensure you are comparing the relevant pricing when evaluating different providers.
The trickiest part about starting with a new payroll service company is the transition. Whether you’re working with a payroll service provider for the first time or switching providers, take care to provide the new company with exact information on what taxes have been withheld from each employee. This will prevent under- or over-withholding problems at the end of the year.
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