How to Start a Small Business Doing Payroll

Money

Whether it is done weekly, bi-weekly or monthly, doing payroll is one of the hardest parts of running a business. For the average business owner, payroll and associated taxes are cumbersome and time consuming. Because of this, most entrepreneurs are happy to hire an outside company to complete this task for them. Companies that specialize in payroll usually have no trouble finding enough work to keep them busy, and once they are familiar with the work, will find that the process is fairly simple. If you'd like to start your own payroll business, it's important that you are willing to not only become familiar with accounting and taxes, but that you are willing to market your company to area businesses.

Things You'll Need

• Computer
• QuickBooks software
• Printer

Instructions

1. Become familiar with federal, state and local payroll tax requirements. Learn how these taxes are calculated, where and with what frequency they should be submitted, and how to properly prepare related paperwork.

2. Purchase a QuickBooks license and learn how to use the software. Most small businesses use QuickBooks accounting software to keep their books. You will need to be proficient in this software to successfully complete payroll for the companies.

3. Obtain a business licenses. Check with your city's Chamber of Commerce to determine what kind of licenses you will need. Sometimes you'll just need a general business license, but some states or towns require special trade licenses or certifications.

4. Market your business. Visit local companies to inquire whether they are interested in outsourcing their payroll. Spread the word among your friends and family that you have started your business and are looking for clients.

5. Conduct your business ethically and professionally. People expect high standards from companies that deal with money. You'll have to make sure that all your work is done properly and according to area tax laws. One false move in your business could drive your customers away.

Tips & Warnings

• Check your state's public records to find potential clients. Look for businesses that have recently applied for licenses or incorporated, then contact them to see if they are interested in your services.