This latest payroll advice comes in the lead up to National Payroll Week which takes place between the 4th and 6th of September and was established to raise the profile and awareness of payroll in the UK.
Bevan Buckland LLP is one of around 1.4 million businesses in the UK that employed members of staff in 2018. Most of the 35,000 medium-sized firms and 7,500 large businesses in the UK have their own in-house teams to handle payroll. For almost 97% of the other businesses with employees in the UK, classed as small firms with 49 or fewer workers, the burden of payroll is patently clear – both in terms of the time and the resources. But could outsourcing provide the solution these businesses need to avoid the pitfalls and relish the benefits associated with running payroll?
“Running payroll consumes a large amount of time each month, with multiple processes to complete in order to comply with legislation and pay workers on time. Apart from anything else, failing to pay staff on time can have a catastrophic effect on morale, and have knock-on effects in employees’ lives. Outsourcing your payroll is therefore beneficial for a number of reasons. It frees up time, allowing more time to be focused on the core business. It gives you access to more technology and expertise ensuring legislation is up to date. Contrary to popular belief, outsourcing payroll also reduces costs and risks as part of a contingency plan,” said Tina Davies, Payroll Manager at Bevan Buckland LLP.
[/aoa]Whether or not you pay your workers weekly or monthly, you have to make certain deductions from their gross pay packets. This includes any income tax, national insurance contributions (NICs), workplace pension contributions, and student loan payments. Firms that operate payroll themselves have to report employee payments and deductions to HM Revenue & Customs (HMRC) on a monthly basis, on or before each payday. With outsourcing, the reporting of any deductions from salary and taxable benefits is handled on your behalf accurately, timely and avoiding any late filing penalties.
Your workplace pension duties can also be successfully fulfilled thanks to the precise and up-to-date records your outsourced payroll partner keeps.
Tina added, “Outsourcing does come with its drawbacks if you fail to choose the right company to handle these affairs. Assuming you pick an experienced, expert firm, outsourcing frees you from the burden of having to keep up with the latest legislation and best practice. This ensures total compliance with HMRC and The Pension Regulator, which oversees auto-enrolment, with minimal effort. For most business owners outsourcing payroll ultimately reduces stress and leaves more time to reinvest in growth.”
Outsourcing has seen more businesses take advantage of the latest technology. The introduction of real-time information (RTI) legislation to the PAYE system can now see businesses fined for failing to submit information to the Revenue each time a worker is paid. Since RTI took effect in 2013, more businesses have chosen to outsource either certain aspects of their payroll or their entire payroll amid fears of becoming non-compliant.
“For most firms with employees in the UK, there comes a tipping point when handling payroll in-house is no longer feasible, although when that point arrives varies from business to business. Outsourcing offers great value for money with the cost of paying an employee to run your payroll usually far exceeding the amount you have to pay an experienced team to handle it on your behalf. Whichever way you look at it, outsourcing your payroll can save you money, give you more time, and provide peace of mind that you will never miss a deadline with HMRC again. Talk to us about your business’s payroll needs and become one step closer to a better managed, more efficient payroll system,” concluded Tina.