Whether or not businesses should receive support services for payroll operations is one of the most important issues to be decided by business owners and managers. Because receiving support services in this regard offers important opportunities to businesses. The payroll process refers to activities related to payments to employees. However, the activities of enterprises within this framework do not consist of a single transaction such as making payments to the relevant persons. Payroll operations also include the preparation of necessary documents, making calculations and other related works. In this respect, it also covers a series of activities such as preparing and monitoring time sheets, calculating gross wages, discount items, overtime hours, reimbursement amounts, taxes, withholding taxes, paying them and reporting.
Businesses can carry out payroll operations in-house or by obtaining professional support services from outside the business. So what does it mean to receive external support services and what benefits do they provide to businesses? Is there really a need for professional support services in payroll?
What is Payroll Support Service?
Payroll support service refers to the delegation of payroll-related transactions to a professional company with expertise in areas such as payroll, tax, accounting, human resources and the fulfillment of the related transactions by this company. Enterprises can carry out all transactions related to personnel payments by a unit or units to be established within the enterprise, or alternatively, they can receive support services in this regard. The importance of obtaining support services in this regard is better understood especially when the structure of the transactions in question is taken into consideration. Because these transactions are technical, time-limited and repetitive within certain periods of time. The execution of payroll transactions requires a certain expertise and continuous monitoring of the relevant regulations. In addition, these transactions are among the secondary activities of enterprises other than their main activities. Apart from these operations, business owners and managers have much more important tasks such as product development, marketing, strategy preparation, and customer relations. In this respect, outsourcing payroll processing to specialized companies offers an important opportunity for managers and employers to focus on their core business. This opportunity stands out as a key element in terms of obtaining support services for payroll processing.
Payments to be made to employees basically concern two parties, the employer and the employees. Any error or delay in the calculation of these payments may cause problems between the parties and disrupt the peaceful climate within the enterprise. There is also a tax dimension to the issue. Errors to be made in terms of tax legislation can bring additional financial burdens to businesses. Obtaining support services in payrolling also serves an important function in order to prevent the emergence of such problems.
Why Businesses in the US Should Consider Hiring Support Services
Payroll support services provide many benefits to businesses. In this context, the prominent benefits in this regard are listed below:
- Payroll support services are useful for reducing time costs: Payroll processing consists of a number of sub-processes such as preparation of time sheets, tracking hours worked, calculation of gross wages, discounts, rights and benefits, taxes, and payment of withholding deductions. Each of these sub-procedures is detailed in its own right and requires consideration of the individual circumstances of each employee. For example, some employees may have worked overtime, while others may be on paid or unpaid leave. Or some employees may receive family subsistence allowance based on the number of children, while others may be entitled to a bonus. These processes recur over pay and tax periods. Some businesses may pay weekly, while others may set payment frequencies very differently, such as bi-weekly, monthly, semi-annually or annually. In short, all these transactions are tedious and time consuming. It is very important for business owners and managers to focus on the core activities of the business instead of these processes in order for the business to gain competitive power. In this respect, leaving these transactions to professionals provides businesses with a more effective management opportunity.
- Payroll support services are beneficial in terms of direct cost reduction: Regardless of the size of enterprises, payroll processes are technical in nature. Proper execution of these transactions requires expertise in areas such as tax, accounting and human resources. If enterprises adopt the approach of fulfilling payroll operations by establishing a unit within the enterprise, significant human resource needs arise. In addition to the need for human resources, training programs, either continuous or discontinuous, need to be organized to train these personnel. Despite these investments to be made, it is always a possibility for the trained personnel to leave the business due to illness or other reasons. In addition, enterprises have to use various software programs if they carry out these operations within their own structure. These programs cause additional costs such as purchasing, maintenance and updating. All these requirements create direct cost items for businesses. These cost items can be eliminated by obtaining support services for these transactions.
- Possible to obtain payroll support service IRS penalty risks to a minimum: Payroll transactions are always error-prone by their very nature. If errors, delays, misinterpretations, etc. occur, businesses may be placed in risky situations in the context of IRS regulations. On the other hand, these regulations change frequently. In this respect, close monitoring of the regulations is of great importance. Failure to follow these changes well or mistakes made during the calculation phase may result in significant penalties for businesses. The support service to be received from expert companies in this respect will minimize these risks.
- Payroll support service prevents potential problems between employers and employees: It is always possible for businesses to miscalculate gross wages, bonuses, rights and benefits, or to delay payments. Such situations can cause unrest between employers and employees. Preventing such problems before they arise is very important for maintaining peace in the working environment. Obtaining professional support services in payrolling also serves an important function in order to prevent employees from encountering such problems.
- Professional support services It also makes important contributions in terms of security: Payroll data of your business is sensitive as it contains personal and private information. In this respect, it should be protected against possible theft or malicious use. Companies that provide professional support services have more competent resources for reliable storage and backup of such data.
Sky Accounting as a Professional Support Service Provider
Which method an enterprise will use for payroll operations is a strategic decision. Whether this process is carried out in-house or by obtaining support services will directly affect the competitiveness of the business. Therefore, it is very important to make the right decision for the business. Sky Accounting provides support on which method is more suitable for the business by taking into account the special situations of the enterprises.
Sky Accounting provides a wide range of services to businesses, from supporting in-house payroll services in accordance with the specific circumstances of businesses, to direct execution of all payroll transactions by providing support services. Thanks to its experienced experts, it has an important support capacity for businesses to continue their activities without being exposed to tax penalties.
Through these support services, Sky Accounting provides important support in managing businesses more effectively. The complex, time-consuming and technical nature of payroll services allows you to focus directly on your core business.
Please click here to see the full range of services offered by Sky Accounting.