You probably already know that the end of the year is a good time to switch payroll providers, as you can start fresh with your taxes and payments in the new year. But what if you can’t wait until the end of the year to switch? Many businesses find themselves changing payroll providers within the year, while still making the process as smooth as possible.
The good news? There’s an equally great time to switch paymasters: the end of a quarter.
Facility to switch at the end of a quarter
Simplify paperwork and clarify responsibilities
Switching at the end of a quarter gives you a clean break, which really goes a long way in making your life easier. Your previous payer will send you quarterly filings for the last quarter and you’ll start fresh with your new payer in the new quarter. No need to worry about multiple filings or recording partial information.
Minimize data entry
Your new payer only needs quarterly totals, rather than personal paycheck data. This can be a big time saver as you get set up with your new provider.
Turn on your schedule
No need to wait until the end of the year to switch. Choose the right time for you and your business, so you can leave your old provider and start with a new one.
How to Switch Payroll Providers at the End of a Quarter
#1: Find a payroll provider that’s right for your business and your budget
Do your research, and talk to them to make sure their setup process matches your needs and expectations. Ideally, they’ll hook you up with an expert who does all the heavy lifting. You’ll also want an accuracy test. And most importantly, you don’t want any set up fees. You are giving them your business after all.
#2: Collect and enter payroll information
If you switch at the end of a quarter, you only need the total of payments and taxes for each previous quarter. You don’t have to detail every paycheck, and that’s what makes EOQ a great time to change. You also need information on all employees and contractors.
Do one more type it yourself? Some providers allow you to set up the pay yourself for complete control. Other providers will transfer all the data for you and let you know when it’s ready.
#3: Don’t cut ties with your previous provider until you’re ready to hit the payroll
Breakups can be difficult. Some pay providers will stop access to your data once you leave them, while others offer lifetime access. Either way, you don’t want to lock out before collecting your stuff.
For those less than cordial past salary relationships, be sure to download all the reports and salary data you need for your long-term records.
#4: When you’re ready, tell your previous provider your filing preferences
Typically, you ask your old provider to finish filing for the last quarter they were with you, but you don’t ask them to file any W-2s or 1099s at the end of the year. Your new provider probably has it covered.
#5: Let your team know
Once you’re approved to run payroll on your new system, let employees know about any changes they see. For example, does your new payroll provider offer an employee portal? What about pay text notifications or emails? What should your team expect to communicate?
Ideally you’ll consolidate tools and move to a software your employees already know, but if not, make sure your new provider offers training materials for the team.
Your employees will receive a Form W-2 or 1099 from your new payer at the end of the year. Let them know where and how they can expect to receive it when the time comes.
#6: Double check your date and paycheck with your new provider
Don’t let your hard work go to waste with mixed up dates. Make sure your last pay date with your old provider is in a quarter and your first pay date with your new provider is in a new quarter. Here are the dates for each quarter for quick reference:
Quarter 1 – 1 January to 31 March
Quarter 2 – April 1 to June 30
Quarter 3 – 1 July to 30 September
Fourth quarter – 1 October to 31 December (this is the end of the year switch!).
Check out Homebase Salaries
You don’t have to be in a bad paying relationship. Switching at the end of a quarter simplifies paperwork, reduces data entry and saves you time. If you’re looking for a payroll provider who knows hourly work, check out Homebase Payroll.
Homebase Payroll enables you to consolidate tools, save time and money running payroll, and create a better experience for your team.
Homebase offers a setup experience for every type of business owner.
Want to do it yourself? check
Want an expert to do it for you? check
Anyone want to review the setup for correctness? check
Want all that for free? check
Check out Homebase Salary today.