How Payroll Outsourcing Helps Startups and Growing Companies Scale Efficiently

Why payroll becomes more complex as businesses grow

As a startup of 3-5 employees it is easy to process payroll using an excel sheet to the payments to a banking portal for processing. But as the head could grows beyond 10 - 20 employees. The Employees need to have flexible benefits, tracking attendance, Statutory deductions like profession tax and Income tax becomes complex exercise for not only founders but also the Human Resource managers in the company as payslips have to be properly formatted and labour law regulations have to be followed. Slight slippage can lead to piling penalties and litigation.

What Is Payroll Outsourcing?

Instead of manually processing your company payroll using excel or learning complex payroll software and regulations yourself. You can hand over the entire monthly payroll processing and compliance to an expert who does it regularly and can scale operations along with your size of operations, lets you sit back and relax and manage your business operations easily.

The Payroll companies not only collect information from your team and process payroll, but also handle employee queries and grievances.

The Payroll agency can provide cloud based solutions to your employees which can self-service employee needs to large extent like downloading payslips and tax declarations and computations.

Why Payroll Management Becomes Challenging as Companies Scale

Following are some of the challenges that you may face while managing payroll yourself

• Collecting tax declarations from employees
• Collecting tax proofs during the year end from employees
• Creating and managing flexible benefit structure for employees
• Multi State Regulatory complexity can expose company to penalties for non compliance

How Payroll Outsourcing Helps Startups and Growing Companies Scale

By outsourcing Payroll process to a reputed payroll companies like CA firms in India, startups and growing companies can benefit in following ways

• Reduced cost- You need not hire costly HR personnel just to handle month end payroll processing our free up HR time which can be utilized towards boosting employee morale or engagement
• Risk Mitigation - Non compliance cost can be minimised as payroll companies usually manage end to end employee regulations like
• Provident fund filings,
• ETDS filings (withholding tax),
• Profession tax,
• ESI filings,
• POSH regulations
• Improved Employee morale: Using sophisticated software like Greythr, Keka, Darwin box, Zoho payroll drastically reduces chances of error in computation and also makes easy for employees while applying for loans
• Tax Savings for Employees: Experienced Payroll service providers also offer tax efficient salary structure for employees which can help improve take home salary for employees

Key Payroll Functions Businesses Can Outsource

Key functions that Payroll companies can provide are

• Month end Payroll processing and generating bank advice
• Salary Structuring for Employees
• Labour Law compliance
• Employee Onboarding and Separation
• Employee Policies Handbook preparation
• Attendance and leave management
• POSH Compliance
• Issuing Form 130 (Earlier Form 16)and tax filing

When Should a Growing Business Consider Payroll Outsourcing?

Startups should look at payroll outsourcing when you notice following

• Recurring errors in payroll register either identified by HR or Auditor
• Headcount about 10 Employees
• Employee complaints on delay in payroll process
• Opening branches in multiple cities

Click here to read more about why you need to automate payroll

How BC Shetty & Co Can Help With Payroll Outsourcing

You may reach out to Payroll companies like B C Shetty Co to standardise CTC structure and error free payroll processing which is scalable along with your business. Click here to read more about our payroll solutions

Conclusion

A payroll outsourcing partner can act as a strategic support function for business growth and relieve you from the burden of managing the most complex administrative task in your business. Ultimately letting you accelerate your business growth.