Payroll Management Options

There are five common methods for calculating and reporting your payroll taxes, used by many small business owners. The following is a comparison of these methods and the advantages/disadvantages of each:

Method
Advantage
Disadvantage
Manual System (Pen and ink, adding machine, spreadsheet, etc.)
  • Full control
  • Tedious Time-consuming Prone to error
Accountant
  • Accountant will be familiar with business' global accounting information
  • Financial expense Less control
Payroll Software
  • Payroll calculations are automated
  • Software learning curve Deposits and reporting are a separate operation
Traditional Payroll Service
  • Shared liability Saves time - service handles deposits and filings
  • Payroll data often stored at service's site Less control Less flexibility
QuickBooks Assisted Payroll
  • Control - payroll information is stored on your computer Integration of payroll and accounting data - no "double entry" Accuracy - payroll calculations are accurate and up to date Shared liability Saves time- service
  • QuickBooks software required Internet connection required
The information contained in this publication is meant to provide general information about the payroll process. This publication is not intended to provide tax or legal advice and does not modify or extend the service guarantee of any Intuit product or service. This publication does not address, and is not meant to address, the entire body of federal, state and local law and regulation governing the payroll process, payroll taxes, or employment law. Such laws and regulations change frequently and their effects can vary widely based upon the number of employees, geographic location, exempt status, labor regulations, and other specific facts and circumstances. You are responsible for consulting with your own professional tax advisor, payroll provider, accountant and / or attorney concerning your business' specific concerns.