What’s Better, In-House Payroll or Outsourced Payroll Providers

Regardless of your business type, number of employees or your mode of operation, one thing is sure every business needs payroll service. However, there are two options to choose from – its either you go with a team of employees to perform your entire payroll in-house or hire professional Outsourced Payroll Providers. However, this post gives insight into the most effective option for businesses.

The Legal Side

Payroll is no child’s play. As a matter of fact, there are legislations in place to ensure businesses act in accordance to the laid rules and regulations. Of course, these regulations get updated on a regular basis hence the need to keep up with these changes. It is your responsibility. In this case, if you’re considering using in-house payroll then it is important that you stay updated with any changes. This is no easy task as it requires a lot of time, money and effort. On the contrary, outsourced payroll providers will handle all the task professionally. And as such you never have to worry about legislation. They will incorporate any new changes seamlessly.


If you’re considering in-house payroll service, you have to factor in the associated cost. If you’re knowledgeable about the payroll procedure, that’s a great addition. If not, then you have to hire extra hands to help you out. This means you will have to spend funds on recruiting, training, payment of salaries and some other benefits associated with the staffing costs. You can avoid all these stress by outsourcing to a professional payroll company. By doing this, you can cut costs.

IT Expenditure

Aside from the expenses that come with staffing costs, IT costs is another thing to consider when going for in-house payroll. Factor in the costs for software, hardware, upgrades, maintenance, support etc. Outsourced payroll providers, on the other hand, will not require IT expenditure as they already have everything in place. Save time, money and resources by outsourcing payroll

Additional Expenses

There are miscellaneous expenses associated with in-house payroll. Though the cost of stationery may seem small, it can be a substantial amount when added up. Some of the items you may need to buy include paper, pen, envelopes, ink cartridges and payslips. Again, outsourcing your payroll eliminates additional expenses. The monthly fees cover all the required expenses.

In-house payroll or Outsourced payroll – Which is a better option

From the illustrations above, it is obvious that outsourced payroll providers are indeed a cost-effective option. Of course, these companies will charge you for their payroll service. You don’t expect free services, do you? However, the fee they charge will be much less when compared to using in-house payroll services. Businesses of all sizes will benefit immensely by using outsourced payroll providers. However, it is important to choose a local company. This is because they are more acquainted with the local laws. Even if you’re familiar with the payroll system, it is best to leave this daunting task to the professionals.


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