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Firm Management: Online Payroll Services
CPA Technology & Internet Advisor
May 2002
Outsourcing Can Save Time and Limit Payroll Risks
If your firm has been reluctant to offer payroll services
due to time constraints or liability concerns, then you might
want to consider outsourcing the work through online services
offered by major payroll providers.
Outsourced payroll services allow you to….
- Focus on more lucrative work. Research indicates
that a small business of 10 employees will typically spend
$2,600 per year in direct labor costs associated with payroll.
You can save your clients time and money by offering payroll
services, but you don't have to worry about the payroll
workload interfering with your other more profitable activities.
- Minimize risks. The IRS reports that 40 percent
of small businesses pay an average penalty of $845 per year
for late or incorrect payroll filings. If your firm made
the mistake, it can be held liable for those penalties.
But most national payroll providers remove that burden for
you by providing a tax guarantee; if the payroll provider
makes an error that results in a penalty, the provider will
pay the penalty.
A new service from SurePayroll (www.surepayroll.com)
allows accounting firms to sell clients a Web-based payroll
service that is completely branded with the accounting firm's
name. Behind the scenes, SurePayroll transparently runs the
Web site for your firm. Under the Web-based private-label
program, called Custom Payroll Service, SurePayroll charges
your firm a discount off its list price for services, such
as tax filing and direct deposit. Your firm can mark up the
price or pass the savings along to clients.
Here's a list of additional payroll providers that you might
want to consider:
- ADP (www.adp.com) offers a full range of benefits, payroll, and business
management services. The company's EasyPayNet provides online access
to payroll processing, payroll tax filing, and benefits administration.
- Paychex (www.paychex.com) is a national provider of payroll, human
resource, and benefits solutions to small business. Its online services
include Paychex Online Payroll, Internet Time Sheet, and Internet Report
Service. In addition, the company offers General Ledger Reporting Service,
which allows companies to post payroll information directly to popular
accounting software packages.
- Ceridian (www.ceridian.com), a large national payroll processor,
recently introduced PowerPay, a Web-based payroll solution that offers
tax filing, direct deposit, and unemployment tax compensation.
- Wells Fargo (www.wellsfargo.com/biz) has been offering payroll services
to small companies for 40 years. The company's OnlinePayroll offering
enables businesses to provide direct deposit, print their own checks,
run payroll and view reports online, and track vacation and benefit
accruals.
When selecting a payroll provider, keep in mind that each provider
is unique. Some payroll providers allow you or your clients
to interface with them via the Web, while others still require
a phone call, a fax, or data entry via a software package and
modem.
In addition, features and functions offered vary considerably
by provider. Some handle every possible payroll scenario and
are equipped to support large Fortune 100 companies. Others
target their offerings to a specific niche market, such as
exclusively serving small businesses.
If you work primarily with small businesses, find a payroll
provider that focuses exclusively on small business and has
a track record in that niche. If you work with corporations,
look for a payroll provider that can handle all of the many
complexities that are associated with those businesses.
The IRS reports that 40 percent of small businesses pay an
average penalty of $845 per year for late or incorrect payroll
filings
Copyright © 2002. CPA Technology & Internet Advisor.
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