When weighing payroll services cost, the many options can be overwhelming for any business owner. While an easy fix would be great, the short answer is: there is no short answer. In the end, the cost of payroll will vary on your business’s specific needs. Get a better grasp on what to expect when pricing payroll service by reading these six things you need to know about the cost of payroll services.
1. True Payroll Services Cost
True payroll cost is determined by necessary for your business. If your business does not have the budget for a whole department, you may hire a full or part time specialist. Think carefully in that there may be a better way. So what does it cost to do the previous? Have a look at the true cost of just the payroll specialist (not manager):
- Federal Payroll Services Cost U.S. = $31,510 to $58,567 annual salary
- Local Payroll Services Cost Dallas = $37,304 – $58,876 annual salary with a $1,500 bonus.
- Local Payroll Services Cost Houston = $37,976 – $70,351annual salary with a $3,000 bonus.
Figures used are from Payscale’s current report.
2. What Should be Included in a Payroll Service
In general, most payroll services should include the most dangerous part of payroll: tax deductions. They should be up to date on the most current tax rates in their bracket and deduct pay accordingly. A payroll service should also know if and which employees do not want deductions taken. The must also report the amount of pay an employee earns to the IRS.
3. They Pay, Not You
Your payroll service should also be responsible for issuing these paychecks. They can even sign these checks and mail them to your business. You may also send them electronically. Payroll services should also be capable of offering a direct deposit option for employees. Popular choices include providers such as ACH Direct, NatPay, and even with popular local banks. Save both time and cost by depositing paychecks in this manner whenever possible. However, some payroll services charge for this particular option.
4. Payroll Information
A payroll service should also be aware of the hours each employee works in order to determine the withholding amount and other deductions. Hours should be able to be sent to a payroll service via phone, fax, and/or email. Salaried employees generally have the same pay, which can change during the year. It is with this data that they can then calculate paychecks.
5. New Hires
All employers are required to report new hires as part of federal and state requirements. Business owners are responsible for handling this but may ask their payroll service to do it. These reports also apply to rehired employees, retired employees, absent employees, and others. Even independent contractors may have to be reported in some cases.
6. What is Usually Not Included
Basic payroll services cost the least, but there are other options. Many offer advanced services you can add on. These include account set up, hiring or firing an employee, check signatures, tax preparation and filing, processing of tax forms like the W2 or 1099, and others. They may also charge extra if an employee has pay withheld for tax or court ordered purposes.
Payroll Services Cost Houston
If you live in Houston and need bookkeeping and payroll services to help maintain your business, feel free to contact us for to learn more on how we can help.