The majority of small businesses in the U.S. are handling payroll processes alone, according to new data from payroll and HR service provider Paychex.
The data, released Monday (Oct. 5), found that more than half (56 percent) of small business owners tackle payroll on their own. And when looking closer at the business owners that outsource these operations, it turns out that having peace of mind is the most important benefit for them when doing so.
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Similar functions, like human resources and benefits administration, are also more often handled by the small business owner solo.
Researchers at Paychex found that 40 percent of SME owners that outsource payroll and other similar functions cited peace of mind as the top cause for their decision to find a third-party service provider, while just 23 percent said they are seeking professional expertise and even fewer (19 percent) said that saved time is the top cause behind outsourcing payroll.
In a statement announcing the research results, Paychex President and CEO Martin Mucci said that processes like payroll are all crucial to any business, regardless of size or industry, but that compliance is a growing challenge for small business owners handling payroll alone.
“The challenge lies in managing and integrating these functions while staying compliant in today’s highly complex regulatory environment,” Mucci said, adding that a third-party service provider can ensure compliance in these areas.
Certified public accountant Todd Zgoda at Bruce Zgoda, CPA remarked on the various ways non-experts are potentially increasing their risk by tackling payroll alone.
“From forgetting to file returns or make payments on time to unknowingly failing to comply with new regulations, the hard lessons business owners can learn are very real,” he said in Paychex’s announcement.
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