Uncovering the advantages of bringing your payroll in-house

24th Feb 2020
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Many SME businesses decide to outsource their payroll processing to an accountant or bookkeeper. This is mainly due to the perceived complexity in getting your payroll right. Additionally, the cost of outsourcing payroll is not only expensive but offers little control over the payroll information

Historically, the task of calculating payroll had been quite a complex process. Today, payroll software technology is doing the work for you by automating many of those complex payroll calculations. Advancements in technology and the development of significantly more affordable payroll tools has changed everything for the employer. 

Employers no longer need to be an expert in all things payroll and many businesses are opting to bring their payroll in-house. Innovative payroll providers are going one step further by offering cloud access and employee apps to employers to streamline the payroll process even further. There are many advantages to in-house payroll vs. outsourcing: 

Cost Savings

Typically a fully outsourced payroll service will cost between £4 - £6 per employee, per month which can quickly add up as you increase your employee numbers. The cost rises even further when employers opt for annual leave management, auto-enrolment and other basic HR functions.

Employers who opt to bring their payroll in-house will have the upfront costs of the payroll software each tax year but the cost savings can be significant. Employers who choose multi-award-winning payroll software like BrightPay can pay just 83p per employee, per month for 10 employees. The cost per employee, per month, can decrease even further the more employees you have. The simple fact remains that processing payroll in-house is cheaper than outsourcing, full stop.

Increased Control

Processing your payroll in-house has the obvious benefit of increased control and instant access to your payroll and employee information. Employers can easily manage who can access sensitive payroll information. In-house processing allows employers to make last-minute adjustments and still pay their employees accurately and on time. All this without the delay in contacting your accountant or outsourced payroll processor. 

In-house control allows for direct access to payroll reports, current and historic employee payslips, payments to HMRC and much more. With a payroll system like BrightPay, you can custom build and save payroll reports to easily analyse any aspect of the payroll information. You don’t get that type of control and instant access when outsourcing. 

Reduced Data Entry

Typically when outsourcing, employers manually enter employee hours and timesheets into an excel sheet or CSV file to then email to their outsourced provider for processing. In-house payroll software like BrightPay allows employers to instantly upload employee hours or rates and apply the relevant pay rates. All of the payroll processing happens on one single system removing the endless data entry and emailing back and forth to update the employee hours each pay period. This produces a cleaner and more efficient process overall. 

Annual Leave Management

Time spent managing annual leave and all other types of leave can be a real time-consuming process for employers. It is often a paper-driven exercise where records then need to be typed up and emailed through to the outsourced provider to update the payroll records. In-house payroll software has now evolved, offering an additional layer of HR capabilities. 

BrightPay offers a Payroll & HR cloud add-on that provides an annual leave management tool which fully integrates with the payroll file. Employees can access a payroll app or an online self-service portal to instantly request annual leave. The leave request then flows through to the employer for approval. Once approved, the annual leave records are then updated on the payroll file. BrightPay Connect streamlines the process of managing employee leave, taking just a fraction of the usual time.

To outsource or not to outsource??

While the option to outsource payroll may seem like a good option, it represents a false economy. Not only do employers spend a considerable amount of time communicating with the outsourced provider each pay period, but this method also offers less value and less control in the long run. More and more businesses are bringing their payroll in-house, putting themselves back in complete control over reporting, accessing historical data and security. 

BrightPay is built with the business owner in mind. Our simple and transparent pricing brings significant cost savings compared with the high cost of outsourcing payroll. All of our packages include free phone and email support should you ever need assistance. There’s a good reason why BrightPay is now used to process the payroll for over 250,000 businesses across the UK and Ireland. What’s more, BrightPay is a multi-award-winning payroll, winning ‘2018 Payroll Software of the Year’ at the Accounting Excellence Awards and ‘2019 Payroll Software of the Year’ at the Institute of Certified Bookkeepers Awards. 

Book a demo to see how you can start saving your business money today and see why our customers rate BrightPay with a 99% customer satisfaction rating.