Pay­roll Chal­lenges Are a Fact of Small-Busi­ness Life

En­trepreneurs don’t want to spend time on ad­min­is­tra­tive chores, but pay­roll com­pli­ance is im­por­tant. Soft­ware solutions can help solve the prob­lem.

Inc. (USA) - - LEAD -

En­trepreneur­ship draws a cer­tain kind of per­son, usu­ally those at­tracted to the idea of be­ing their own boss and grow­ing some­thing from small be­gin­nings to a size­able en­ter­prise. The re­wards can be sub­stan­tial, but there are road­blocks along the way. A big one is the bur­den of managing pay­roll and stay­ing com­pli­ant with ever-chang­ing tax laws and reg­u­la­tions.

“Run­ning ac­cu­rate pay­roll is time-con­sum­ing, and get­ting it right can be tough,” says John Cum­bee, gen­eral man­ager of SurePay­roll, a lead­ing on­line pay­roll ser­vice for small busi­nesses na­tion­wide. “Even the most metic­u­lous busi­ness owner is at risk of a mis­cal­cu­la­tion, a missed dead­line, or over­look­ing a reg­u­la­tory change.” Any such mis­step can re­sult in penal­ties, fines, and un­happy em­ploy­ees.

Pay­roll ad­min­is­tra­tion is about a lot more than just hand­ing out checks. A huge amount of data must be col­lected and man­aged to de­ter­mine how some­one should be paid, how ben­e­fits time is man­aged, how taxes are with­held and paid, and how com­pli­ance and re­port­ing is con­ducted.

“There are many nu­ances to pay­roll re­port­ing and com­pli­ance, which can be daunt­ing when en­trepreneurs are start­ing out,” says Sean Cooper, di­rec­tor of part­ner man­age­ment at SyncStream Solutions, a provider of health care and Equal Em­ploy­ment Op­por­tu­nity Com­mis­sion re­port­ing and com­pli­ance soft­ware. “But there are tech­nol­ogy solutions that can help re­duce the bur­den.”

Tra­di­tion­ally, the op­tions avail­able to own­ers of small and mid­size busi­nesses (SMBs) have been to take a do-it-your­self ap­proach or to hire a full-ser­vice pay­roll provider. How­ever, there are prob­lems with both solutions.

“I think there’s no ques­tion that try­ing to set up pay­roll them­selves is not a good use of a busi­ness owner’s time,” says David War­ing, co-founder of FitS­mal­lBusi­ness.com, an on­line ed­u­ca­tional site for SMB own­ers. The big­gest challenge is sim­ply know­ing how every­thing works—reg­is­ter­ing with the right agen­cies, fill­ing out mul­ti­ple forms for each em­ployee, and meet­ing in­di­vid­ual state com­pli­ance reg­u­la­tions, to name a few.”

Full-ser­vice pay­roll providers take all that off the busi­ness owner’s plate, but the cost can be pro­hib­i­tive for a small com­pany. For­tu­nately, a third op­tion has emerged in re­cent years: pay­roll soft­ware solutions.

“SurePay­roll mar­ries the best of what pay­roll soft­ware and full-ser­vice of­fer­ings pro­vide,” Cum­bee says. “Our cus­tomers main­tain full con­trol of their pay­rolls, while ben­e­fit­ing from award-winning live cus­tomer sup­port and au­to­mated fil­ing and pay­ment of taxes.”

Per­haps most im­por­tant from a busi­ness owner’s per­spec­tive, SurePay­roll backs up its prom­ises with a ro­bust guar­an­tee. IRS sta­tis­tics show that roughly 40 per­cent of small busi­nesses in­cur penal­ties av­er­ag­ing $845 a year. But if one of its cus­tomers re­ceives a no­tice from the IRS or any other tax agency based on a fil­ing that SurePay­roll made, the com­pany will work with the agency to help re­solve the is­sue on the busi­ness’s be­half. “And, if we are at fault, we’ll pay all the as­so­ci­ated penal­ties and fines,” Cum­bee em­pha­sizes.

Some key ar­eas to focus on when choos­ing a pay­roll ser­vices provider of any type are pric­ing, com­pli­ance, ease of use, and cus­tomer sup­port, War­ing says. The best solutions of­fer busi­nesses fea­tures like an easy-to-use pay­roll por­tal that al­lows them to in­put wage and hour data at an in­di­vid­ual em­ployee level and then pre­view and ap­prove pay­roll on their sched­ule, from any­where at any time, us­ing any de­vice. It’s also im­por­tant to look for a provider that main­tains cur­rent tax rates and sup­ports new and ad­di­tional de­duc­tions as reg­u­la­tions are in­tro­duced--ideally, with­out any ac­tion on the part of the user, such as hav­ing to man­u­ally up­date soft­ware.

Fi­nally, since growth is the goal of most SMBs, it’s im­por­tant to plan for it early. Choose a pay­roll ser­vices provider that will al­low you to eas­ily mi­grate to the right so­lu­tion at each level of growth.

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