Payroll Outsourcing Hong Kong

A payroll service that is outsourced to a third party company, instead of being carried out in-house.

An outsourced payroll service can include every aspect of setting up and administering a client’s payroll processing. The only action the client needs to do is to feed in employee data weekly or monthly as required – the payroll provider does everything else.

Sovereign can also offer a part-managed payroll service, which allows clients to continue running their payroll in-house, whilst outsourcing the majority of the associated time consuming activities. In this way your business can benefit from the expertise of our payroll professionals and technology, while still maintaining a degree of control and input.

Sovereign provides a Payroll Outsourcing service in Hong Kong that includes the following key features:

• Requirements capture – We work with you to define your requirements and understand what your business needs from a payroll service
• System set up – We will create a system for your business using IRD-compliant software that is kept continually up to date with all relevant legislation changes
• Data entry – Data would include hours worked, bonuses, pensions and other details that affect wage calculation. We take receipt of data from our clients and the security of that data very seriously.
• Calculations – We will undertake all calculations necessary to produce a final wage slip, including tax and MPF.
• Payslips – We produce a security sealed payslip for each employee/pensioner
• Payments – We arrange BACS payments of wages and pensions direct into employee bank accounts
• Additional documents – We produce necessary documents for individual personnel and the IRD as required
• Reporting – We provide regular reports (e.g. weekly, monthly) as required. We also provide bespoke accounting reports if these are needed.
• End of Year – We calculate and compile all end of year figures and submit them to the IRD on your behalf

An employer’s tax obligations commence as soon as the first employee is hired. On hiring an employee, you are required to maintain the following records in Hong Kong:

Personal particulars
Name, address, identity card or passport number with place of issue, marital status

Nature of employment
Full time or part-time

Capacity in which employed
e.g. business developer, programmer, manager, lawyer, accountant, director

Amount of cash remuneration
Regardless of denomination in domestic or foreign currency and remuneration paid outside Hong Kong

Non-cash and fringe benefits
Such as quarters, holiday journey benefits, share awards, share options

Employer’s and employee’s contributions to the MPF or its equivalent

Employment contract and amendments to terms of employment

Period of employment
An employer is also required to inform the Hong Kong Inland Revenue Department (IRD) of the following:

• Any change in the employee’s personal particulars – such as change in residential and postal address, change in marital status
• Any change in the employee’s terms of employment – such as a change from full time to part-time
• The Hong Kong Identity Card number of the employee

Business owners in Hong Kong are required to keep business accounting records, including payroll records, for at least seven years.

Cost Savings
There is no need to employ dedicated staff to administer your payroll and no need to pay ongoing software licensing costs for payroll software

Time Savings
Your staff are freed up to work on managing the core business activities of the company

Security and Compliance
You don’t have to worry about staying up to date with changes in taxation or payroll legislation, this is taken care of automatically

Visibility and Control
You retain complete visibility and control via reports and access to your payroll manager.

For the majority of Hong Kong businesses – particularly SMEs – all these benefits bring greater potential for long-term growth. Outsourcing payroll functions that are time consuming and costly, and frees up resources and capital to focus on core business objectives and delivering maximum value.

HR outsourcing can support small businesses with guidance on day-to-day HR duties – such as employment legislation, or health and safety regulations – as well as maintaining compliant employee records and conducting administrative tasks. Through HR outsourcing, you gain access to consultants with the expertise and capacity to take on all sorts of HR responsibilities, including:

Performance management
Conducting performance-related tasks efficiently

Dedicated HR resource
Providing expertise as and when required, or an ongoing basis

Training and development
Ensuring team members are completing training and developing in their role

Recruitment
Attracting and hiring the right talent too help your organisation grow

Rewards
Ensuring that salaries and other benefits are suited to both the needs of your business and those of your team members

Absence management
Understanding employee absences and ensuring that the correct procedures are being followed

Employment law
Advising on the latest developments and legislation to keep your business up-to-date

Health and safety
Assessing workplaces, and providing guidance on another crucial element of HR to ensure your business is compliant

By choosing to outsource HR, your business could benefit in the following ways:

Greater flexibility
You can alter which services you need as and when required

Access to specialists
You can hire experts in particular areas of HR when you need them, instead of relying on one person to understand everything

Cost savings
Streamline spending and only pay for assistance in the types of HR that are essential to your business

Improve processes
Cut out any unnecessary work and refine your business operations

Better technology
Outsourcing can give you access to a wider range of technology, including HR software

Free up resources
Outsourcing can relieve the call on the time of senior team members or the expertise of an in-house HR department, if your business has one

Legal compliance
A specialist HR provider can help to ensure that your business is fully compliant

Enhanced recruitment processes
From sourcing candidates to managing interviews, outsourcing recruitment allows your business to optimise its hiring procedures

• Do you have a high rate of staff turnover at your company?
• Are all of your employee files organised properly? Do they contain all of the relevant documents and are they stored correctly?
• Do you have an employee handbook, giving details on all of your main policies and procedures, and do all employees have access to it?
• Are you recruiting new staff as quickly as you would like to?
• Is a performance review process for employees in place?