If you’re reading this, chances are you run a business.
You put a lot (read: everything) on the line, and face make-it-or-break-it decisions on a daily basis.
One of those decisions will be payroll management.
Do the last two words make your eyes glaze over?
Before you sleep easy, it pays to safeguard your rest from potential nightmares.
When nearly 50% of employees start looking for other work after just 2 payroll errors, it’s easy to picture nightmarish scenarios. Not to mention grim letters from the CRA, or worse - audits.
So, do you keep it old school and write cheques, or outsource payroll?
Let’s get something out of the way first: we’re more than a little biased at Knit.
But we didn’t build payroll software out of love for simplified accounting alone.
We did it because payroll automation is quickly becoming standard.
It’s good for your employees, it’s great for dependability, and it’s fantastic for your wallet.
By The Numbers: A Quick Case Study
Good software helps you scale and manage complex data easily.
Great software does this at a fraction of the cost of every other alternative.
Say you just hired your first employee. You’ll have to answer two questions:
● How much is your time worth?
● How are you actually going to pay your people?
Question 1 is easy - your time is invaluable, and “do-it-yourself” is pretty much out of the question. Your business is simply better off without you handwriting cheques or fiddling with administrative arithmetic.
Which leaves two serious options:
● Hire a bookkeeper.
● Get payroll software.
Let’s start with the first. You might need full bookkeeping services or you might not - this really depends on the nature of your business, how good you are at financial management, and where you want to invest resources.
That said, a reliable bookkeeper will run you about $55 per hour.
But whether you have someone taking care of the books or not, getting payroll right is non-negotiable. Because the alternative means risking extremely unpleasant conversations with the CRA.
Payroll Pricing In Perspective
Say you have just one employee, and you pay them $40,000 per year.
At $39/mo + $4 per employee/mo, having software fully take care of your payroll costs you $516 for an entire year - or slightly over 9 billable bookkeeping hours.
That’s about 1.2% of the salary assumed above.
But let’s say your business grows and you hire more staff.
At 2 employees/ month, your per-employee payroll costs drop substantially.
Now you’re paying $282 a year (or 0.7% of salary) to take care of one employee’s payroll.
3 employees? $204/employee/year.
4 on your payroll? $165/employee/year.
(You get the picture.)
“Ok that’s nice,” you might say, “but what do I actually get?”
Well just for starters…:
100% tax accuracy. ✓
Easy handling of “unconventional” income types. ✓
Employee self-onboarding. ✓
Exact payroll remittances to the CRA. ✓
Direct deposits (and the gratitude of your employees). ✓
Crystal clear reports about your payroll expenses. ✓
Automatic T4 generation and filing. ✓
ROE creation and filing. ✓
Automated paystubs. ✓
And of course…
Total peace of mind that the CRA never sends you scary letters about payroll audits because it was high-season and someone made a typo. ✓✓✓
Finding someone that guarantees all that as a starting point alone, charges you less as you add more people to your team, and lets you seamlessly transition your operations and data whenever something changes... is a tall order.
Software Makes Businesses More Resilient
Automation brings convenience and peace of mind.
But more than that, platforms like Knit’s create longevity and adaptability, as your core back-office functions no longer rely solely on a single individual or department.
That means your risks of processing payroll incorrectly (or worse yet, not processing at all) drop dramatically. Even when you deal with sudden changes or as your business grows, you can easily project costs and never worry about tying up unnecessary resources in administration.
And most of all - what makes us at Knit really proud - modern software means you serve your team better. Trust us - they’ll thank you for it.
By Matas Pranckevicius on Oct 10, 2018