Should you hire a Payroll Clerk? CPA? Payroll Service? Lets do the math.

Many small business owners either try to do their own payroll, hire a payroll clerk, or they send their info to a CPA to handle their needs. However, There are payroll services out there that are very budget friendly and are on the up and up when it comes to payroll calculations, Tax laws, Year end W-2’s, 1099’s and so on. With the current economic climate, many business owners are finding that outsourcing payroll to a payroll service is a good way to cut expense while still getting a quality service that everyone is happy with. So is it right for you? Lets do the math.

First off, lets say you hire a payroll clerk. Now they will handle all your payroll needs including reporting new hires to the state. The average wage of a Payroll clerk? Around 13.00 per hour. Spread over a month that cost is around 2000 dollars. And this does not include the taxes that an employer has to match, workers comp insurance, etc.

Next lets look at a CPA. Most CPA’s in my area charge an hourly rate. The going rate around these parts is about 65.00 per hour. They will generally spend around 8 hours per month doing a customers payroll. That is an average of 520.00 per month. The drawback here is they will also charge you if you call them, if they have to make any changes (such as address changes, merit increases, Etc.)or if you need to run an additional payroll. in the end, CPA’s have bigger fish to fry, and you will have to pay them a lot more to make it worth their while.

Finally, Payroll Services. Generally, payroll services charge an administrative fee, and a per check fee. My firm charges a 40.00 administrative fee and the per check fee varies anywhere from 5.00 per check, to 1.25 per check depending on the size of the company. Lets say you have 25 employees. Our fee is 150.00 per month, and all of the payroll bells and whistles are included.

So in the end, if you feel you have payroll problems, then we have payroll solutions. Think about it. Would you rather pay 2k per month, 500+ per month, or 150.00 per month? All three options give the same service. Save yourself hundreds if not thousands per month, and use a payroll service provider.