6 Great Reasons for Outsourcing Your Payroll

Running a startup effectively requires overseeing a range of tasks that need to be performed both regularly and effectively. For startups with multiple staff, payroll is one of the most costly and time consuming tasks for an organisation.

Outsourcing payroll duties to an experienced professional firm can result in many benefits.


Big businesses can afford to maintain big payroll departments. For Startups however, an in-house payroll service is a money burner. If you calculate the hours your employees spend on payroll-related activities, plus payroll software costs, training costs, printers, printing and distributing payslips, creating tax documents etc, you could be surprised by the result when you compare that amount to the cost a payroll service provider can offer.


The payroll function can consume a large proportion of your staff resources, especially if the staffs in charge of the payroll are not trained specifically to deal with it or have the payroll function as a smaller part of their overall responsibilities. The benefits of outsourcing the payroll include freeing up these resources allowing your staff to concentrate on more essential tasks. You may even be able to reduce your staff’s size. Outsourced functions also give you better scope for expansion of your startup with scalable services suited to your startup 

Eliminate Technology Problems

An outsourced company will ensure the payroll software used is the latest version, and will have the most recent tax tables installed on their computers. Doing it yourself without the latest technologies can mean errors arise, and exposes your startup to penalties. 

Free up time to focus on other things

Outsourcing your payroll allows your business to free up time to focus on other important aspects of the business. It can be a time consuming and monotonous task, that eats into your productivity. In a recent study, Inc magazine showed payroll to be the number 1 task for companies to outsource.


In-house payroll activities function as reliably as the people doing the work. With a payroll service, output, speed and quality won’t vary in accordance with holidays and sickness. There is always a risk that you may lose one of the key members of staff that deal with your payroll and all their knowledge walks away with them. If this happens you could find it extremely difficult to replace them, causing a logistical nightmare come payday. You also won’t have to spend time training new staff or helping them to understand your startup’s payroll system.



Do you have the time and energy to closely supervise your startup’s payroll for time and rate abuses and other shady activities? Most payroll outsourcing companies have technologies that can spot and alert clients to various types of payroll fraud, such as payment manipulation and ‘phantom workers’.