Take it from us: setting up a payroll system for small business is much easier if you have intuitive, comprehensive software, but given that payroll software has fees, at what point do they save you enough time to justify this extra cost?
If You Have A Bookkeeper and Only 1-2 Employees
- If you have a reasonably priced bookkeeper and are only paying 1 or 2 people through payroll, you might save $10-20 a month by doing it manually.
- But then the bookkeeper will have to issue the pay stubs and T4s, and you will have to make all the remittance payments and filings for corporate tax, EI and CPP.
- One benefit of running your payroll manually is some flexibility in that you can initiate the payment the day of or the day before through your banking or EFT system, whereas most automated systems require you to finalize payroll 4 days before the payday.
If You Don’t Have A Bookkeeper, Use Payroll Software
- If you don’t have a bookkeeper, we recommend using payroll software because payroll can become very complicated.
- To do it manually will require you to invest a lot of time in understanding all the rules and regulations and can be a very time-consuming task on an ongoing basis.
- Payroll software takes care of much of the complexity for you.
- It’s a bit like filing your own taxes – you definitely would use software to make sure you take advantage of all the allowed deductions and to make sure you did it right.
Once you are at 2-3 people on the payroll, you’ll save enough time by using a software system to make the fees of the best small business systems worthwhile.