In accounting circles, there is a perception that payroll services are not a great investment for an accountancy practice, due in part to the specialist resources needed and the time it takes to process the payroll. Plus different pay periods and deadlines can be confusing which in turn increases the chances of making mistakes.
If you’ve spent any time working on large, complex and frequent payroll, you’d probably know what we are talking about.
However if handled right, payroll can be a strategic initiative for your accountancy practice – and payroll processing can be a great way to add value to a client’s business and generate a new revenue stream for your practice.
What is payroll outsourcing?
Payroll outsourcing is a cost-effective opportunity for accountants to increase revenue from their existing clients. It has the added benefit of being cheaper than when done in-house, and frees up current payroll staff for more lucrative work.
Outsourcing payroll has become an option that many accountants are looking at especially after the introduction of RTI and auto-enrolment.
Why outsource payroll?
Outsourcing your payroll to an external company can bring a number of benefits to your practice.
1. Remove the auto-enrolment stress
The introduction of auto-enrolment and RTI has added extra pressure on accountants to comply on time and accurately or their clients may have to pay penalties. Outsourcing payroll means alleviating the burden of this complex legislation.
2. Save time
Payroll can be a profitable service for accountants. However handling it is a time consuming task as it requires staff with full knowledge of PAYE and specialist software. Outsourcing this can free up staff’s time to deliver potentially more lucrative work.
3. Say good bye to software training & upgrade costs
Outsourcing companies often have their own licensed versions of UK payroll software. By outsourcing your accountancy firm’s payroll to them you will save £1000’s in software costs, upgrades and training
4. Reduce costs
Hiring payroll specialist staff is expensive – in addition to a salary, you have to pay overheads, desk space, benefits and other employment costs. When you add this to the cost of payroll software costs and the training costs involved to remain up to date with legislation, outsourcing payroll could save you a lot of money.
5. Access a pool of payroll experts
Rather than having one or two payroll members in your team running payroll alone, outsourcing it give you access to much wider range of experience and expertise form professionals who have spent years dedicated to payroll.
How do we know outsourcing will make payroll profitable?
We have seen one of our clients, nyc Chartered accountants and business advisors (nyc-BMCA) make payroll profitable by up to 60% after they chose to outsource. You too can learn how to to do that in our guide – ‘Making Payroll Profitable’. Download this FREE guide by clicking here.
Driving the change
There is one main reason for accounting firms to offer payroll services - Profit! The second reason is to offer one-in-all package to your clients. If you don’t, they might go look elsewhere. So it makes sense to act now.