A payroll service is a company that will handle all of these functions independently, freeing up the business owner's time for more important matters. Using an outsourcing service makes it possible to manage the payroll process without the need to maintain a large payroll department. Payroll service provides preaparation of wages and salary, withholding of taxes, the distribution of withheld funds to the proper government agencies, and the direct deposit of net wage to the bank accounts of employees.

There are many advantages why a company can go with a payroll outsourcing option. The most common is ofcource to save time and money. As a result, there is no need to spend a majority of the workweek calculating wages, taxes, and dealing with various types of withholding issues.

Another important benefit to using a outsourcing service is that the employer does not have to keep up with changes in regulations that impact the calculation of taxes. Since the outsourcing service constantly updates their information to comply with current laws, the employer never has to worry about incurring late charges and other penalties, due to an improper calculation of the taxes due. Even this benefit alone would save a significant amount of money over the course of a year.

Also prevents an employer from having to deal with technology which is cangeing in a high speed. There is never a need to upgrade payroll software or spend time and money on program or hardware of the system issues that can occur and slow down the payroll process.