Outsourcing Payroll - A Guide for Small Business
In this guide, we explain what a payroll service provider is and how they can help your business grow. It also provides helpful hints for choosing a payroll provider. Outsourcing payroll can save businesses time and money by streamlining processes, ensuring compliance, and improving security. At Prontus, a payroll service provider, can help with onboarding, continued support, compliance, payslips, and more.
If you’re considering outsourcing payroll, you’ve likely decided to outsource your payroll to a reliable third party. To help you make this important transition, we’ve created a helpful guide, as payroll and HR impact every area of your business. Regardless of the managed payroll services model you choose, selecting a provider that fits your budget and needs is crucial.
What is a payroll service provider?
A payroll service provider - also known as a payroll bureau - is an external and regulated company that businesses rely on to avoid the hassle and cost of managing payroll in-house. These providers handle tasks such as:
calculating employee pay
making necessary deductions
ensuring compliance with current regulations
submitting filings to HMRC
generating and sending P60s, P45s and other reports
One option available is a fully managed payroll service.
“A fully managed payroll service is where a business entrusts its entire payroll process to a payroll provider. Essentially, this approach is tailored to the company’s size, business complexity, industry, and specific needs. Full-service payroll providers can also offer a comprehensive range of payroll and HR management solutions too.”
Can you outsource payroll to any company?
Accountants and payroll bureaus are company who are regulated and supervised. Only companies or accountants and bookkeepers who are registered with an anti money laundering supervisory body with a licence number can run payroll and act on your behalf with HMRC. These payroll bureaus submit all the necessary information on behalf of you and your business within the timeframe allowd by HMRC.
How a payroll bureau can help your business grow
For any business to grow, it needs a firm grasp of its financial position. Growing a business also means growing your staff team. Streamlined and efficient payroll is key to making sure your people get paid the correct amount, at the right time and every time.
And that’s why turning to a payroll provider is a great move.
#1 Payroll that works with your business
Managed payroll services take care of all the important stuff:
Onboarding of employees and continued support
RTI to HMRC each payroll run
Ensures you remain compliant with payroll regulations
Password-protected digital payslips, annual P60s and P45s
Sick pay, maternity pay and other employee benefits covered
#2 Professional element to your onboarding process
A sleek and professional onboarding process speaks volumes to new employees and with a payroll provider, everything around adding them to your payroll is taken care of.
For example, at Prontus we:
Create an employee record with accurate information on our payroll system
Email the current HMRC Starter Form or use their latest P45 to ensure a smooth transition from their previous employer
Ensure they can access their digital payslip at an email address of their choosing
Answer any queries they may have
Calculate their annual leave entitlement
Ensure that when staff leave, they receive the correct final pay amount
Support you with the latest information on annual leave for full and part time staff, payment in lieu of notice and much more
Are on hand to discuss via email or phone any issues or queries you may have
#3 Secure
Using recognised cloud-based payroll software, employee data is safe, an essential component for business in the data protection era.
We work with BrightPay, a recognised and popular provider of payroll software for payroll bureaus and accountants across the UK.There are several levels of authentication for each time we access the system and so you can be confident we are doing as much as we can to keep information and personal data secure.
We can also process secure payment to your employees. Using a secure payment portal Modulr, you have complete oversight of who is being paid and how much. Working ahead of your pay date, it gives you time to make adjustments.
Once confirmed, you simply move over the correct amount of money into your individual account on the system that we set up. We approve all payments and your employees are paid on time, just after midnight on the given pay date.
No matter how frequent you pay or even if you have a mix of pay runs e.g. weekly for some staff, hourly staff or salaried, a managed payroll provider will deal with it all.
Is it possible for a small business to run its own payroll?
Yes, it is perfectly feasible for small businesses to run their own payroll. There are pros and cons, just as there are pros and cons to outsourcing payroll. The advent of accounting software such as Xero and Quickbooks means that this is entirely possible. Connecting to HMRC, once you have made payroll, you simply submit this in ‘real time’. This updated your account and you will make the usual monthly or quarterly payroll for National Income contributions and tax.
When payroll is relatively uneventful - that is, the same number of payments each pay period - running your own payroll is fine. When it becomes more complex such as maternity or sick pay, it means having to spend more time on getting the numbers right.
When people are paid incorrectly, it can induce panic. People rely on their wage or salary and so being paid correctly and on time is essential.
And this is why many small businesses outsource payroll to a bureau. Is this something you are considering?
Outsourcing payroll to Prontus is so easy but we also understand that it is a big step. You want to be sure that we can be trusted to deliver the service we say we do.
As payroll experts, we will talk you through the entire process including:
Client due diligence - as a supervised payroll bureau, we have a range of compliance issues we must meet, such as anti-money laundering. We use a secure system to quickly and effectively check clients.
Discussing how your payroll currently looks and how you think this may change in the future
We can ‘run’ payroll in that we generate payslips for employees but you continue to make payments directly
Or, we can handle everything!
To find out more, email us today hello@prontus.co.uk - there is no obligation!
