This time of year many payroll and tax departments are finalizing year-end processing, making sure that wage and tax records are accurate, and that payroll tax returns are filed correctly and on-time. Some payroll and tax professionals are also taking this time to evaluate their current payroll tax process and considering a better way to manage payroll taxes.
When presented with the option of outsourcing, often times tax and payroll professionals don’t want to “lose control” of their payroll tax process, data integrity and decision-making ability. Despite all of the available technology to automate payroll tax processing, some professionals continue to go to each jurisdiction website to make electronic payments or manage important dates and tax payments with Excel worksheets, sticky notes and Outlook calendar reminders. In today’s heavily regulated marketplace, returns and deposits are at an all-time high and the penalties and interest an employer may face for non-compliance and/or inaccurate information result in consequences that are too costly for such inefficient payment methods and reminders. The fact remains that internally managing current period reconciliation, tax deposit reconciliation, quarterly/annual reconciliation, and Federal and State unemployment reconciliation across several divisions and/or multiple taxing jurisdictions can prove to be a more time-consuming and labor intensive process than turning over some or all of the payroll tax process to an outside expert.
When payroll and tax professionals choose the right outsourcing partner, they should ultimately retain control. With the right partner providing a web-based solution, reporting tools, compliance insight and the appropriate level of service; your tax department will recover lost time, achieve greater visibility into payroll tax filing schedules, access real time payment information and up to date quarterly variance information and gain efficiency in year-end processing.
With the right partner and tools in place, outsourcing payroll taxes to an expert will ensure compliance and control of a complex process, while creating a strong foundation for company growth into new markets and taxing jurisdictions.