A suitable and effective payroll system is crucial for any business. Whether your business has 5 employees or 100, it is important to ensure that their wages are paid in a timely and accurate manner. Accurate payment is important for adhering to applicable regulations and ensuring employee satisfaction. For optimal payment processing and distribution, it is worth knowing the types of payroll systems that are available and how to determine which option is right for you. As experts in bookkeeping and payroll services, the team at Leskun & Son Accounting has compiled some information on the most common payroll systems available for most businesses.
4 Common Payroll Systems
The following payroll systems are commonly used by all types of businesses:
1. In-House Payroll
If you have a small number of staff members with little variation in weekly hours, in-house payroll processing can be a viable option. A dedicated employee can be hired for this role, or it can be added to their weekly responsibilities depending on the size of the company. This employee must stay updated and knowledgeable on staff changes, payroll tax laws, taw withholding, and tax filing. In-house payroll services minimize security risks for financial data, but multiple employees may need to be hired as the company grows.
2. Professional Bookkeepers and Accountants
For small to mid-sized companies, consider outsourcing your payroll to a bookkeeper or CPA (Chartered Professional Accountant). These individuals or organizations often have the expertise required for accurate payroll information and tax records; however, bookkeepers and CPAs often do not offer bank interface services such as direct deposit. Even if your payroll processing is outsourced, you are ultimately responsible for ensuring that all information is correct.
3. Payroll Services and Agencies
Payroll services and agencies are great for large companies or smaller companies that want to be free of day-to-day payroll obligations. They typically provide services such as direct deposit and deductions from paycheques. Some payroll services or agencies also guarantee their work, making them the contact for the CRA in the event of an issue. Though a payroll service or agency is a comprehensive solution, they are often one of the most expensive options.
4. Online Payroll Services
Online payroll companies allow you to monitor and manage payroll details at any time from a secure web browser. Most businesses simply need to enter all required information for their employees regarding their wage/salary, deductions, sick days, and vacation days. Once this information is entered, the system will maintain these records and perform payroll tasks. Some online services also offer tax services, making them a comprehensive choice for nearly any business.
To learn more about the types of payroll services, or for assistance determining the best choice for your business, get in touch with Leskun & Son Accounting. Our team can be reached through our online contact form and will be happy to answer any questions you may have.