Are you looking for a payroll company to help you process payroll? This short article will help you understand the different payroll company types, and will also tell you how to find them more quickly than just browsing around the internet.

So, what kind of payroll company is right for you? There are two main types:

• Payroll Software Company

  This company develops payroll software which is purchased and installed on your computers. Some payroll software companies sell at retail stores, and some sell through partners or accountants. The software can be installed on one or more computers and all of the payroll data is then housed internally. The benefit of using software from a payroll software company is you have more control of the process. Depending on the size of your business and the depth of your payroll needs, it might also be more economical.

• Payroll Service Company

  A payroll service company provides the service of processing payroll for you, and can also take care of the payroll tax filing. You will still need to input such things as hours worked and maintain employee information. Instead of purchasing and installing software, the software is typically accessed online. Accessing the software online does save you from having to maintain the software with updates. The benefit of using a payroll service is the burden of tax filing is on their shoulders instead of your own.

It is nearly impossible to do a thorough job of researching to find a payroll company by merely searching online for ‘payroll company’. You won’t find a comprehensive list of payroll companies on the first page of Google. You need a better way to find the best payroll company. There are a few good directories available, and here are a couple of them.

• Capterra.com allows you to choose in detail, which payroll features you will need. Look within the accounting software category, as this is where payroll is typically found.
• FindAccountingSoftware.com also allows you to choose the details of the type of system you are looking for by choosing necessary features.

Both of the above Web sites also offer the possibility of calling them to speak with a consultant, tell them what you are looking for, and then receive calls from the vendors that fit for your search. This is free for you as a software purchaser.

Has anyone ever tried to sell you something you were completely uninterested in purchasing? You know, the long and drawn out sales pitch with the salesperson talking non-stop about features, not even stopping to take a breath for fear you will say, “NO.”

It’s times like this when we appreciate our ability to be assertive and walk away. This situation can happen just about anywhere from the car dealership to the perfume counter, or to a work situation. The simple resounding answer to give these tenacious sales people is “NO.” Purchasing software for your company is no different! If you are currently satisfied with the accounting or payroll software for your business, it’s probably a good idea to stay with what you have. After all, switching software involves a learning curve, and your company will need to take the time to adjust.

While the above is true most of the time, there are certain times when a business person believes they don’t need to move to a different software application, yet for the good of their business, they absolutely should. Here are the main reasons a company should consider a software move, even when they don’t think they need to.

1. You are still using a DOS based product. There were many excellent DOS products available in the 1980’s. In fact some of them still work well to this day. This leads some people to believe they can keep using the program(s) to run their business indefinitely. If you are using a program that was created in the 1980’s, the upside is that the company you bought it from must be pretty good to have kept it working that long. If you drive a car from the 1980’s you have surely had a lot of work done just to keep the thing running. Nothing can last forever. When it comes to software, DOS based software is a thing of the past and you need to move forward as soon as possible, or at least develop a plan to do so. Operating systems are moving forward and Microsoft has released Vista, with talk of the next system around the bend. Your DOS system probably won’t work on either one. So if any of the computers in your operation crash, you will need to purchase a new one. Where will you be when there aren’t computers available to run your DOS program? Develop a plan now, and you won’t have to panic later.
2. Your software product is no longer being supported. If your product is no longer supported, you will not be able to get your questions answered and will be left to handle questions and problems on your own. Updating to something newer will allow you to ask questions and get help when you need it.
3. You are spending more time ‘tricking’ your system than simply working with it. This is the kind of thing you don’t realize you are doing until after you change software. Set aside one whole week where you consciously keep track of how much time you or your staff spends manipulating your software to handle the way you need to enter or analyze your data. Are things such as invoice entry or inventory tracking taking you three to four steps when they should really only take one or two? If so, you and your staff could save significant time by moving to a system that can handle your needs.
4. You have a hard time finding hardware that will work. Simply put, you should be able to find hardware such as computers, printers, and other devices for your business without much hassle. If you have to search from store to store or on eBay to find a device that will work with your old software system, it’s time to upgrade your software.
5. You stay with your accounting software and/or payroll software because you are afraid. Don’t feel bad. There are many business people who simply stay with the software they have even while they know full well they really should move to something different. They know that their security would be better, their processing would run more smoothly, and that they would save themselves and their staff valuable time by moving to newer software. Feeling bad won’t help, but developing a plan to move forward will. Even if you can’t make the switch now, planning it out ahead of time will reduce the worry and stress you are feeling right now.

Are you wondering whether employees are really there when they say they are? Does your payroll staff spend time re-entering hours instead of pulling them in electronically? If so, then your company may be ready to implement a time clock, and integrate it directly to your payroll software. There are several distinct benefits your company can enjoy by doing this.

Eliminate double entry.

With the implementation of a time clock, hours worked are entered directly into the time clock by the employee, eliminating the need for hand-written time cards. This can eliminate the confusion of unclear or inaccurate handwriting. When it comes time to process payroll, the time worked is pulled in electronically from the time clock, eliminating the need for somebody to re-enter hours. This not only saves a significant amount of manual work, but also ensures better accuracy.

More accurate tracking of hours worked.

Do you wonder whether employees are actually working the hours they recorded by hand? This worry can be drastically reduced or eliminated with the implementation of a time clock. There are various methods provided by time clocks to ensure the employees are actually recording their own hours and not ‘buddy punching’, a term which refers to people punching in and out for each other. There is a wide variety of clocks providing different methods of verifying time worked, such as the biometric clock, which verifies employee identity based on their actual fingerprint.

Smoother processes.

Integrating your time clock with your payroll software makes your whole payroll process faster and simpler. After all, if you have to re-enter data from the time clock into your payroll software system, you are losing out on a great deal of the benefits you were meant to have. Be sure the time clock you choose will work together with your software application; this will guarantee much faster and simpler payroll processing for all involved.

By implementing a time clock, your business can gain more accurate pay information and streamline payroll processes. Make the most of your time clock with a direct interface to your payroll software, and you’ll be on your way to a much simpler and smoother payroll processing system.

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The reporting of tax liabilities to multiple state and federal agencies is one of the most onerous and scary requirements of having employees.

Over 25% of businesses experience a penalty for errors, late filings, or other mistakes filing employment tax, averaging over $700 each year.
(Source: IRS data book 2010)

Large companies may make deposits and file reports several times a week. That’s hundreds of filings in multiple states each year. Automating this process provides significant savings.

No matter what size the company, compliance to eFiling requirements, ever-changing forms, and meeting new guidelines legislated into existence during the year is difficult, and opens you to significant fines and penalties for non-compliance.

Moving to eFiling

Any change in the way your business operates should be made for the purpose of improving efficiencies, lowering expenses, limiting liabilities, or to keep up with changing requirements in regulations or marketplace.

Changing payroll reporting and payments to eFiling meets many, if not all, of these reasons. The simple interface and comprehensive nature of many of the forms and payments solutions available, provide efficiencies to virtually any other reporting and payment options. Automated error-checking functions eliminate virtually all rejections, as well as eliminating the liabilities associated with potential fines and penalties. One of the biggest changes in the business regulation environment is the stated goal of the IRS and SSA to make all communications and business practices to be conducted electronically.

Since many states take their lead from the federal standards, it will not be long before virtually all state and federal payments will be required to be sent electronically.

The Problem

Moving to electronic payments is inevitable. The question is how to go about changing over from your current process to electronic delivery.

With over 170 state and federal taxing agencies and myriad different processes, formats, forms, and deadlines, many businesses have just thrown up their hands and outsourced reporting to payroll services and paid very significant fees to do so. In many cases they simply felt they had no choice. The threat of non-compliance is just too scary.

Other companies have hired additional staff and decided to use agency websites to process payments and reports. Again the business is faced with going to several different sites, none of which have the same process. Those businesses are faced with unique logins for each site, separate tracking methods for each site, and multiple contacts to try to resolve any issues that may occur while transcribing in payroll data or attempting to export/download multiple files for the various sites.

The Solution

Find a solution that is integrated in your payroll module and does not require transcribing information, creating exported files, or transcribing to a website. The solution should provide automated payroll reports that are filled in automatically with your payroll data and can be eFiled with just a few clicks. The interface should be intuitive and simple to understand. A replica of the actual form displayed onscreen and the review process very simple. The steps required to eFile should be few and well defined.

The solution should support all of the federal and state agencies you file with and include unemployment, wage withholding, and new hire reports and payments.

There should be a single login to eFile and view all filing histories. Any filing should be time-stamped and dated to provide an audit trail.

There should be a calendar system that provides reminders for filing deadlines that could be received via email, desktop alerts, or even text messages to your cellular devices.

Compliance guarantees should be part of the service. All negotiations with state and federal agencies concerning filings should be conducted by representatives of the service. Any fines or penalties incurred because of service errors should be paid by the service.

Finally it needs to be affordable. An annual subscription that includes all of your filings for twelve months should be based on how many employees you have and should be less than outsourcing to a payroll service.