As a business owner, do you dread doing the payroll? Does it consume a lot of your time?
Do you often think you could delegate payroll to another staff member, but due to reasons of confidentiality, you just decide to do it yourself?
How would you feel if you were to delegate or outsource your payroll to a reliable, reputable and efficient advisor? Would you feel relieved knowing you could also collaborate with your advisor online at any time?
What about granting access to an internal staff member by restricting their admin rights?
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This is why I love about outsourcing payroll within my business
I took the plunge nearly six years ago to outsource my payroll and I haven’t looked back.
I had a grand total of seven staff. As an accountant in business for 11 years, I was certainly capable of processing our pays in MYOB. But as my business grew, I couldn’t find the time. On a Monday morning, the phones were always running hot, I had clients to see, staff needed my attention and it was 4pm before I knew it.
Nowadays, I can rock up to the office on a Monday morning and go about my day just like any other work day.
On Mondays, our pays are processed by a local bookkeeping firm, payslips are emailed and a bank transfer file sent my business partner for uploading to our internet banking. It is literally less than a five-minute task for him to review the figures upload and authorise.
I have managed to both outsource and delegate.
Here’s what I love about outsourcing our payroll to a local bookkeeping firm:
- I can rest easy knowing that myself and my staff are going to be paid correctly and on time regardless of what I am doing – whether I have client appointments, whether I have work to do, whether I am on holidays, whether I am sick or whether it’s a public holiday
- there is absolute confidentiality about staff pay rates – our practice manager only needs to email weekly timesheets
- there is no reliance on a single employee to perform the payroll function so there is no risk or interruption to our business if an employee leaves or is absent on leave
- all pay rates are kept up to date with any Award changes
- we can prepare pay runs in advance if our pays fall on a public holiday
- it is very cost-effective and time-efficient and I can collaborate with my advisors at any time
- me and my staff can focus on doing what we love, what we are good at and what is valued by our clients
- the firm preparing our payroll only has access to the payroll module of MYOB so all other MYOB data remains confidential and cannot be accessed or altered
- our annual payment summaries are prepared with the last pays of the financial year and the annual reconciliation lodged with the ATO on that same day.
The beauty of outsourcing and finding a firm you feel comfortable with is that as your business grows, you may consider outsourcing other bookkeeping functions.
In my business, I still look after this. With the efficiencies of using MYOB BankFeeds and SuperStream, I am able to produce monthly financial statements within days of the end of the month.
Is outsourcing payroll for you?
So, do you think outsourcing of payroll is for you? As a starting point, I suggest that you consider the following points:
- Is it just payroll you want to outsource?
- Would you consider outsourcing other bookkeeping functions?
- Are you wanting to outsource to a firm within Australia or one that is overseas?
- Consider the cost to your business of processing your payroll in-house. If you are doing this yourself, take a note of how much time it takes each week and then consider how much money you could make if your time was spent on your core business offering. If you currently have staff preparing your payroll, ask them to take a note of how much time it would take and then calculate the cost at their hourly rate adding other on-costs such as superannuation, workers compensation, payroll tax etc.
- Shortlist a number of firms or providers or do what I did and ask around – I love personal recommendations
- Get a quote and compare to what it is currently costing you. It’s not just about money either – it could be your sanity, having flexibility to take leave or not wanting to go grey prematurely.
- Write a list of what you loathe and stress about when it comes to payroll
- Write a list of all of the things you feel nervous about so you can communicate this with a prospective provider
- Consider timing of any change and create a plan
Six years on, I still use that same local firm to process my payroll and I wouldn’t have it any other way.
READ: Making payroll less complicated
Outsourcing is one area but there are probably many areas of your business that could do with a revamp. I challenge you to use the last six weeks of the financial year to take some time out to review all areas of your business and consider ways to improve and enhance your current practices.
Now is the perfect time to set your business up for the new financial year.
MYOB AccountRight gives you full control of how you pay your employees, including calculating employee tax (PAYG), state-based payroll tax, superannuation, leave entitlements. And you can collaborate with your team or your trusted advisors.