There is a perception amongst accountants that payroll is not a profitable service. It requires staff with full knowledge of PAYE and specialist software, and is time consuming. We even know some clients who have turned away business because there was a large payroll requirement.
However this is at odds with the needs of your existing clients or potential new customers. They expect it as part of an all-in-one accounting service. They don’t want the hassle of doing it in-house. Nor do they want to outsource their payroll to one company, and their accounting work to another. They want it to be taken care of, preferably by one supplier.
Fortunately if handled right, it can be a strategic initiative for your accounting or bookkeeping practice – and processing payroll can help build deeper client relationships.
So why outsource payroll?
This brings us back to payroll being a resource driven activity, yet doing little to help your accountancy or bookkeeping practice differentiate itself from the competition.
As such, it often makes sense to outsource it to a specialist service provider so you can focus on business strategy and client satisfaction while leaving the processing to a third party. In addition, it means you can focus on your value proposition rather than on administrative tasks like keeping up with legislation, and incurring costs on software and training.
The other benefit is your get access to the service provider’s expertise, technology and processes without needing to invest in skills and infrastructure yourself. Thus outsourcing your payroll eliminates many of the back-office costs associated with operating the payroll function in your practice.
You no longer need to worry about keeping up with ever-changing payroll compliance and regulation or bear the costs of upgrading software and incurring license fees. Plus, computers on your network are no longer tied up processing client’s payroll, allowing other work functions to be processed and improving productivity of your business.
The growing complexity of UK payroll law and tax regulations, paired with a tight economy, means that accountancy and bookkeeping practices see a great benefit in outsourcing the processing of client payroll. By working with a service provider, for whom payroll is bread and butter, you can be sure that your client’s payroll is accurate, timely and you are compliant with the latest tax laws and calculations. Another major benefit is the payroll outsourcing company can help you increase profits from payroll by up to 50% over in-house processing costs.
How can you determine if payroll outsourcing is appropriate for your practice?
Check each question, in the list below, for which you are able to answer YES.
- Do you constantly monitor evolving payroll legislation and adjust your processes to ensure compliance?
- Are you up-to-date with all related legislation, such as auto-enrolment?
- Do you always process payroll on time with 100% accuracy to avoid costly financial penalties for errors or non-compliance?
- Are you always able to answer payroll-related enquiries from your clients immediately and accurately?
- Are you putting valuable, strategic practice goals on hold to complete repetitive administrative tasks?
- Do you have the time you need to invest your skills and talents fully in your practice’s strategic goals?
Get a PDF version of your ‘Payroll Outsourcing Evaluation Checklist’.
When choosing a payroll outsourcing company, it pays to compare not only pricing, but service levels (turnaround time, accuracy, timeliness), and value added to your accountancy business as a whole. As a specialist outsourcing company with integrated accounting, tax, bookkeeping and payroll services for UK accountants and bookkeepers, QXAS is your essential business partner in help you make payroll a truly profitable service for your practice.
Learn how to make payroll profitable for your practice using the free guide below.