Managing payrolls is a very important business function that involves many more activities than just writing paychecks. Payroll management includes a wide spectrum of tasks such as calculating salary and allowances in accordance with prevalent compensation laws, TDS computations , secretarial compliances, managing employee health and pension contributions etc. and depositing the same with the authorities.
But the question that arises is that should a company manage payrolls internally or should the same be outsourced? There is no prescribed answer for this and the considerations which affect this decision include factors such as number of employees to be managed, expertise in payroll management, funds availability and the need to maintain control and secrecy. While large companies may typically find it easier to handle payrolls internally given the abundance of funds and large number of employees, maintain in-house payroll function may not prove to be feasible for SMEs and may only lead to escalation of cost.
Payroll Outsourcing typically works well for SMEs and startups. The various benefits that accrue from payroll outsourcing include:
• Cost saving : Since specialized outsourcing firms perform the function of outsourcing on a large scale, it leads to achievement of economies of scale and the consequent benefit of lower cost.
• Time saving : The small team of entrepreneurs can concentrate their effort on core issues like product development and business development, thus preventing the wastage of talent and precious time.
• Compliance : Payroll outsourcing services can cater effectively to the need of concurrence with laws and regulations.
• Employee exit management : Managing PF transfer in order to ensure smooth employee exit can be efficiently performed by payroll outsourcing services.
The boom in start-ups and SMEs will definitely have spillover effects by the way of increase in the demand for payroll outsourcing services. Further, payroll outsourcing services can be customized to suit unique needs of SMEs. There is no easy answer for SMEs wondering to handle payroll. Aristotle Consultancy provides complete end-to-end payroll services using modern technology to ensure checks and balances on time. With a dedicated payroll team, 50,000 employee cycles have been processed. Payroll hassles are away while our services walking along your way!