Decoding The Substantial Business Benefits Of Payroll Outsourcing

A non-core process no matter how essential doesn’t contribute to revenue generation for an enterprise and payroll comes as one such pivotal, non-core process in all businesses


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While business consultants have long endorsed outsourcing of non-core processes, in this article I will specifically touch upon the strategic business benefits for enterprises by outsourcing payroll

A non-core process no matter how essential doesn’t contribute to revenue generation for an enterprise and payroll comes as one such pivotal, non-core process in all businesses.

Business heads when giving a thought about payroll are juggled with numerous questions including-:  how do they actually benefit by outsourcing payroll? Is it worth all the time and effort to evaluate an appropriate outsourcing partner? And most of all do outsourcing benefits supersede this effort?

To help ease this uncertainty let’s do a pointwise analysis of payroll outsourcing benefits-:

Saves on Time

Since the processing of payroll comes as a time-consuming process, outsourcing it enables the staff to focus on other important revenue-generating processes.

Shrinks OPEX

Collaborating with an efficient payroll service provider can greatly reduce the operational expenditures of a business as it eliminates the need for a dedicated in-house team of professionals.

Complying with Regulations

With payroll outsourcing, you can save your organisation from penalties and fines. As per an estimate, about 40 percent of business shell out penalties owing to incorrect filings. This undesirable situation can be avoided by partnering with a renowned payroll service provider as many payroll service providers offer a tax guarantee and ensure that you don’t have to pay any fine.

More Time to Focus on Core Processes

Your management can now focus more on revenue-generating processes rather than struggling with in-house issues related to payroll and compliances.

Cut down on Risks

Performing payroll in-house indeed attracts a lot of risks as it involves updating tax tables, submission of reports as well as disbursing payments. This not only deviates the attention from core work but also increases the chances of mistakes which can be eliminated by outsourcing payroll.

Enhanced Privacy

Free yourself from the anxiety of losing your payroll employee to a competitor by outsourcing your end to end payroll process. Besides by having an outsourced partner, your payroll data remains outside your office premises and remains confidential, ensuring that there are no data leakages. 

24 Hours Customer Support

Experts related to payroll are always available at just a call or an email away when you partner with an efficient payroll service provider. Also, avoid the hassle of having to update your payroll software time and again.

How To Choose A Payroll Service Partner

If you are considering outsourcing your payroll, then these three elementary factors should be under your scrutiny before inking an agreement-:

  • Pricing
  • Service Quality
  • Credibility

With payroll, however, there are certainly other options to consider as well-:

Security Aspects and History of the Provider

You are sharing confidential details with your service provider including the names, addresses, PAN details, bank account numbers as well as the power of attorney to make filings on behalf of your organisation. Always zero in on a partner with a credible history and track record.

Service Offerings

Always keep in mind the services which you may require as your business grows including HR services and benefits. Will the payroll firm you are about to choose will be able to scale up the services as your business grows?

Regulatory Compliance 

Is the payroll provider capable of aligning with the ever-changing laws and regulations related to tax and employment?


Always evaluate the payroll company’s technology readiness including its focus on mobility. Is the firm investing in technology to keep up with the growing demands of its clients?

Disclaimer: The views expressed in the article above are those of the authors' and do not necessarily represent or reflect the views of this publishing house

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