Setting up payroll for any business is a complicated process, but it can be simplified – at least on your end as the owner. There are a lot of tax considerations, including federal, state and local (or city) taxes, as well as social security and unemployment insurance. Not to mention, each employee has a different status and tax situation, and difference deductions to claim. So how can you handle this burdensome process? Simple – hire an affordable payroll service.
When I owned two stores, I had four full-time employees and several part-time employees, along with the extra help during the holidays. My staff count varied from seven to 14, and the daunting task of handling payroll started to bury me, until I discovered professional payroll services. I hired the third largest payroll service in my state of Pennsylvania, and found that these services are easier and more affordable than you’d think.
The payroll company will take the information and W-2 forms from each new employee you hire. I was able to fax these to them, simply and quickly. At the end of each pay period, whether it’s weekly or monthly, they call you for the hours of each employee. For me, they would just run down the list of each employee, and I would read off the hours. If you have a lot of employees, you can just fax or email them the list of all employees’ hours worked.
Then they prepare the checks and print them for you, with your bank account number and company name. The checks arrive the next day by courier; you sign them and hand them out. They can also handle direct deposit for you. You just need to make sure the funds are in your account. At the end of each quarter, they file your taxes for you and send you a report. Easy.
Payroll services charge by the number of employees and the number of pay periods you have. I paid my employees monthly; the cost is higher to issue paychecks weekly or bi-weekly. They also charge if you need them to file your quarterly taxes, and you do! It’s money well spent.
My cost was $90 per month to have checks issued for about 9 employees, once per month. There was a fee of $50 each quarter to file my taxes, and a small extra fee for annual taxes. I paid about $1400 a year for payroll services. That’s a lot cheaper than my own accountant would cost, and it really saved me some time!
A larger company with 25 employees would pay $150 per month with my payroll service, so you can see the cost per employee is reduced as your number of employees rises.
Finding a Payroll Service
Finding a service is easy; just look in your local web directory or yellow pages. Call three of them and they’ll send out representatives to explain their services. Compare the cost and services and choose which one is right for you. Look for “small business” packages or specials. Negotiate to get any “set up” fees waived. Your payroll can be up and running smoothly in just a few weeks.