What is a payroll bureau?
Payroll bureaus are third-party companies that work with their clients to help run their payroll.
Many accountancy firms also provide payroll bureau services for their clients.
Working with their clients, payroll bureau services offer expert support and can take care of:
- Processing payments and expenses
- Sending out payslips
- Issuing payslips in accordance with niche legislation, e.g. paying contractors under the Construction Industry Scheme (CIS)
- Preparing payroll reports for HMRC, such as year-end and Real Time Information (RTI) reporting
What’s the difference between a payroll bureau service and outsourced payroll?
While payroll bureaus and outsourced payroll services do differ, these terms are sometimes used interchangeably, describing the same solution – the exact definition often depends on the provider.
Typically, outsourced payroll services offer an end-to-end service (fully managed payroll), moving all data and functions over to their system. While this helps take a load off clients, they will have to conform to the provider’s processes and timescales.
On the other hand, normally with payroll bureau services, the client retains ownership over payroll functions and still needs to handle some aspects in-house. Payroll bureaus can provide different levels of support, so clients can choose how much control they have over the whole process.
Featured Guide
Becoming a payroll powerhouse: solutions for accountants and payroll bureau providers
If you’re a payroll bureau provider – or you’re interested in learning more about payroll bureau services – download this free guide on becoming a payroll powerhouse. Learn more about:
- How software can improve payroll bureau services
- How to identify your payroll bureau technical requirements
- Your payroll bureau software wish list
- Choosing a software provider
- Payroll bureau software recommendations
What challenges do payroll bureaus face?
Running payroll is no walk in the park – after all, that’s why many businesses turn to payroll bureaus to help them run theirs.
For payroll service providers like accountants and payroll bureaus, there are plenty of challenges to contend with. But luckily, there are also solutions available to help manage and overcome those roadblocks.
-
Rolling payroll deadlines and tricky legislation
For payroll bureaus and accountants, running payroll is always at the top of the day’s to-do list.
Multiple pay dates and new deadlines every week aren’t the only priority. Legislation like Real Time Information (RTI) reporting, automatic pension enrolment and GDPR are all additional considerations, and it’s up to payroll bureau providers to ensure their clients’ payroll is always compliant.
This is why many payroll bureau services use software to help get the job done – there are many systems on the market designed specifically to help payroll bureaus support their clients.
-
Communication with clients
In the fast-paced world of payroll bureau services, managing client communications is critical.
But without the right tools, it can be difficult to achieve.
If your clients are submitting payroll information via email or phone, you risk data falling through the cracks. Plus, your clients are going to expect timely responses and follow-ups.
Many payroll bureau services use a dedicated online system to effectively capture and manage data as it flows into the business. Online solutions support by providing clients with the means to submit payroll data via a handy self-service portal.
-
Keeping data safe and secure
Because payroll involves handling incredibly sensitive information, payroll bureau providers need 100% confidence in their processes.
Alongside ensuring data is stored in a secure place, payroll bureau services also need to be sure that:
- Internal processes are secure – especially if staff are logging in from outside the office
- There are suitable access measures in place, e.g. multi-factor authentication
- Manual data entry is kept to a minimum to reduce the risk of human error impacting data security
Failure to keep data secure can lead to significant fines for payroll bureaus and accountants. Online payroll bureau systems can help mitigate security risks and avoid the collateral damage of mismanaged data.
-
Managing work oversight
With fast and hard deadlines comes pressure on staff to get the job done, no matter what.
Payroll bureau services need to carefully manage their staff’s time and their workloads. If someone’s absent, payroll providers can’t afford to let a client’s payroll slip through the cracks.
Many payroll bureau service providers use technology to help manage their workloads.
- Cloud-based payroll bureau systems provide a universal source of data, so teams can access critical info in their colleague’s absence
- Shared workflows help managers spot chokepoints and ensure team members aren’t left in the lurch
- By communicating with customers through a shared online system, teammates can step in and take over correspondence if needed
-
Payroll complexities and specialisms
As a payroll bureau service, you’re expected to be an expert in all things payroll whatever the industry your clients happen to be in.
You’re expected to be able to support clients with complex or niche payroll requirements, including:
- Paying a contractor through the Construction Industry Scheme (CIS)
- Automatic Enrolment
- Accommodating pay scales
- Payroll for the education sector (where staff often fulfil multiple roles with different payroll requirements)
- Expatriate employment
However, many payroll bureau services – including accountants – use specialist software to compensate. Technology can help you run payrolls for all kinds of clients, ensuring compliance and accuracy.
Frequently asked questions (FAQs)
Learn more about payroll bureau services, how they support clients, and how technology is changing the payroll bureau game.
-
A payroll bureau is a service provider that supports clients with running their payroll. While there are dedicated payroll bureau services, accountants often provide payroll bureau support as part of their services.
Unlike outsourced payroll services, payroll bureaus support clients with running their payroll while the client retains control and oversight of their data. Payroll bureaus are an ideal solution for businesses who want expert payroll support while keeping payroll functions in-house.
-
No, businesses are well within their rights to run their own payroll in-house – larger organisations may have their own payroll department to keep things running smoothly.
However, payroll is an increasingly complex and critical business function. Employers can’t afford to get it wrong, and that’s why they turn to payroll bureau services, to ensure their payroll is run correctly.
Unlike fully outsourced payroll solutions, payroll bureau services run their client’s payroll while the client maintains ownership and oversight of their payroll data. This is why even larger companies with dedicated payroll departments might use payroll bureau services – especially if they need help with fiddly or complex payroll functions.
-
Costs of payroll bureau services can vary significantly depending on the scope and scale of the service.
A payroll bureau might charge based on how many payslips they’re running for their client. The cost may also depend on factors like what sector the client is in, or whether they need complex or niche payroll services.
-
If you are an accountancy firm or service provider who wants to offer clients a wider range of services, setting up a payroll bureau needn’t be complicated.
While you should have a working knowledge of payroll functions, you can use specialist software designed to help businesses provide payroll bureau services. There are software providers who will white-label their solutions – which means you run payroll for your clients without undertaking extra work.
Also, knowing your costs from start to finish ensures you’re aware of the profit you’re making upfront. This can give payroll bureau providers greater confidence when quoting services.
-
Since legislation like Real Time Information (RTI) reporting was brought in, it’s no longer feasible to run payroll manually.
Understandably, that means payroll bureau providers – who are running anywhere from dozens to hundreds of payrolls per month – will also need to rely on technology.
-
A cloud payroll bureau is a payroll bureau service that uses cloud-based software to provide their payroll services.
Many payroll bureau providers use software to support their clients, improve efficiency, and ensure legislative compliance. A cloud-based payroll bureau system offers additional benefits like:
- Universal source of information that staff and clients can access
- Client self-service functionality, so customers can review their payroll progress
- Improved data security measures
- Automatic software updates whenever legislation changes
- Being accessible for anywhere with an internet connection
If you’re a payroll bureau provider, there’s a lot to be gained in considering switching to a cloud-based system.
Learn more about payroll bureaus
Blog Article
Mastering your payroll: in-house vs outsourced
Blog Article
Navigating a modern workforce: the three biggest payroll challenges and how to overcome them
Blog Article
