by Rebecca Baxter

AROUND 1.4 million businesses in the UK employed members of staff in 2018, and all of them shared one thing in common: the legal requirement to run payroll.

This task consumes a large amount of time each month, with multiple processes to complete in order to comply with legislation and pay workers on time.

Most of the 35,000 medium-sized firms and 7,500 large businesses in the UK have their own in-house teams to handle payroll.

Apart from anything else, failing to pay staff on time can have a catastrophic effect on morale, and have knock-on effects in employees’ lives.

But for almost 97 per cent of the other businesses with employees in the UK, classed as small firms with 49 or fewer workers, the burden of payroll is patently clear – both in terms of time and the resources it takes up.

For most firms with employees in the UK, there comes a tipping point when handling payroll in-house is no longer feasible, although when that point arrives varies from business to business.

Keeping up to date with constantly evolving regulations can be tiring for business owners, and the introduction of real-time information (RTI) legislation to the PAYE system can see businesses fined for failing to submit information to the Revenue each time a worker is paid.

Indeed, since RTI took effect in 2013, more businesses have chosen to outsource either certain aspects of their payroll or their entire payroll amid fears of becoming non-compliant.

Throw in GDPR legislation, which was introduced in May 2018, and keeping your employees’ data confidential and secure has never been more important.

Research from Sage, which polled 850 accountancy practices in the UK in 2018, found that 62 per cent of respondents had adopted cloud-based solutions.

It’s therefore fair to say that the majority of accountants in the UK secure personal information, such as that of your employees, in an encrypted online environment.

Whichever way you look at it, outsourcing your payroll can save you money, give you more time, and provide peace of mind that you will never miss a deadline with HMRC.

Talk to us about your business’s payroll needs.

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