When you buy through affiliate links in our content, we may earn a commission at no extra cost to you. Learn Finding the best payroll software for small businesses in the U.S. is key to managing employee payments, taxes, and compliance without stress. Great payroll tools go beyond simply processing paychecks – they save time, reduce errors, and ensure you stay compliant with federal, state, and local regulations.
To help you make an informed choice, I’ve hands-on tested the top 10 payroll software options, evaluating them for ease of use, automation features, accuracy, compliance tools, and customer support. In this guide, I’ll share my findings so you can pick a payroll solution that simplifies payroll and helps your business grow.
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Best Payroll Software For Small Businesses 2024
What is Payroll Software?
Payroll software is a tool that helps businesses pay their employees accurately and on time. It handles tasks like calculating wages, deducting taxes, and sending payments – often automatically. Some payroll tools let you run payroll as many times as you need, while others stick to a set schedule, like weekly or monthly.
The best payroll software also ensures your business follows tax and labor laws, so you don’t have to worry about compliance. By automating tasks and reducing manual data entry, using software saves you time and helps cut down on costs, making it a great option for businesses of all sizes.
Benefits of Payroll Processing Software
Using payroll software for your small business in the US offers a range of benefits and helps you streamline workflows while staying compliant with tax and labor laws. Let’s dive into why investing in the best payroll software can be a game-changer for your business.
- Time Savings – Manually managing payroll can take hours, especially when calculating taxes, deductions, or handling different payment schedules. Payroll software automates these processes, completing them in seconds. For example, features like automated tax calculations, direct deposit setups, and recurring payroll runs mean less time spent crunching numbers.
- Improved Accuracy – Payroll errors can lead to unhappy employees and costly penalties. Payroll software minimizes human error by automatically calculating wages, taxes, and overtime based on input data. Many platforms are designed to handle complex scenarios like bonuses, benefit deductions, and multi-state taxes, ensuring accurate and compliant payroll every time.
- Cost Savings – While there’s an upfront cost to using payroll software, it often pays for itself in the long run. You’ll save money by reducing the need for outsources payroll services or additional admin staff. Plus, software with built-in compliance features helps you avoid fines for tax errors or missed deadlines, which are common pitfalls for small businesses.
- Enhanced Data Security – Payroll software often includes robust security features to protect sensitive employee and business information. These platforms use encryption, secure cloud storage, and regular updates to comply with US laws like the Fair Labor Standards Act (FLSA). This means you can trust that Social Security numbers, banking details, and salary information are safe from breaches.
- Higher Team Morale – Employees are the backbone of your business and their morale can make or break your operations. Payroll software ensures they’re paid accurately and on time, which fosters trust and satisfaction in the workplace. Many platforms offer self-service portals, allowing employees to access pay stubs, tax forms, and benefits information easily. This reduces any risk of confusion and keeps them informed.
Overall, using payroll software isn’t just about simplifying your workload. It’s about building a reliable foundation for your business.
Top Payroll Software Features to Look For
Payroll software can have a variety of features, but the following are the most essential:
As this is one of the most time-consuming and error-prone tasks, the software should handle it for you.
Payroll software should withhold the right taxes from wages and send them to the relevant authorities. If you’re international, it should be able to differentiate between different systems.
Top payroll software handles the payments for you. If you have a global team, it should support your staff’s local currencies.
If employees can log in to edit and review their details, that means less work for you. They can also have more peace of mind over their wages and flag issues quickly.
You should be able to generate payroll reports for accounting, finance, and compliance purposes.
Your payroll processing software should integrate with your accounting software so you can keep accurate track of payroll history when it’s time to file taxes.
What to Keep in Mind When Choosing Payroll Software
Apart from features, cost, and usability also take into consideration the following when you’re selecting your payroll system to make sure the software can meet your exact needs.
- Size of Your Business – The main factor that will influence your choice. You might run a startup now with only a handful of employees, choosing your first payroll system, but how many employees are you planning on having in one, two, or five years from now? The solution you choose should be able to scale with your business.
- How Often Employees are Paid – Do you pay your employees weekly or monthly? Do you work with contractors who need to be paid per invoice? Are you employing full-time and part-time staff? Perhaps you have a mix of all three factors? The payroll provider you select must be suitable to the number of payroll runs you do, the type of employee you have, and support in contractor payments.
- Where Employees are Based – Not all payroll providers can handle multiple currencies or be compliant to use outside of the United States. The expectations on international payroll software compared to software handling a single state are different, and you need to ensure your chosen provider is suitable for your needs.
- How to Handle Payroll Taxes – Some payroll services handle taxes, others don’t. Before you sign up, you have to decide if you want your software to handle employee payroll taxes and what it offers in terms of compliance and cost for end-of-year tax calculations.
The Best Payroll Software for 2024 Reviewed
My review analyzes each payroll solution by exploring its features, pricing, and customer support. Using this information, I evaluate each software’s pros, cons, and best use cases.
Deel — Best for Global Payroll
| Free Trial | Free 30-minute demo |
|---|---|
| Price From | $49/month |
| Mobile Compatibility | No |
| Countries Available | 150+ |
Why I Picked Deel
Deel is the best choice for global payroll because it serves over 150 countries and offers flexible payment methods. I found its automation tools easy to use; with just a few clicks, you can pay employees and contractors worldwide. Deel handles tax filings, local compliance, and other payroll complexities, so you don’t have to worry about international regulations.
I like Deel’s integration with popular finance apps like Revolut and Wise and even the option to pay in cryptocurrency. Its comprehensive global payroll system covers everything, including onboarding, payroll taxes, and multi-currency payments. However, I think it may be too feature-rich for companies focused on domestic payroll only. In that case, Rippling would be a more cost-effective option.
Deel Pricing
Like many alternatives, Deel has modular modular pricing for all its features. The following plans allow you to handle payments and taxes:
| Deel Plans | Monthly |
|---|---|
| Contractors | Starts at $49/month |
| Global Payroll | Custom |
| EOR | Starts at $599/month |
- Contractors – Ability to hire and pay international contractors compliantly.
- Global payroll – A full-service payroll plan, including automation, reporting, and compliance management.
- EOR – A set-up where you outsource HR, payroll, and benefits to Deel.
All plans give you access to Deel’s free HR module with automation tools, org charts, and document management.
Who is Deel Best For?
Deel is the best payroll software for global teams.
Pros 
- Global payroll services
- Free HR module
- A range of Slack integrations
- Advanced reporting tools
- Immigration and visa services
- Support for multiple payment types
Cons 
- Mobile app unavailable
- Limited time tracking tools
Rippling — Best for US and Canada-Based Payroll
| Free Trial | Free demo |
|---|---|
| Price From | $8/month |
| Mobile Compatibility | Yes |
| Countries Available | 50+ countries |
Why I Picked Rippling
Rippling stands out as the best payroll solution for businesses based in the US and Canada, offering robust tools designed to navigate the complexities of North American tax laws. It automates payroll tasks, including wage calculations and tax filings, and helps businesses manage payroll alongside other HR needs like onboarding and benefits.
What stands out to me is its modular platform. This lets you add only the features you need, so you don’t pay for unnecessary tools. It can handle global payroll in 90 countries, which is fewer than Deel, but it can be a good starting place for small businesses that have just started their expansion journey.
Rippling Pricing
As Rippling has custom pricing, you must contact them for a quote. Here are the payment modules available:
- US and Global Full Service Payroll – The option to manage payroll in over 50 countries worldwide.
- Global EOR – Assistance with international hiring and payroll.
- PEO – A solution that allows you to outsource your US payroll and benefits administration management.
Aside from payroll, Rippling has a range of other HR, IT, and finance modules. It’s worth noting that benefits administration is standalone and not included in the plans above.
Rippling’s integration ecosystem, though extensive, is not as wide as platforms and accounting software like Workday or BambooHR. Therefore, businesses heavily invested in niche HR/workforce software may find integration gaps and want to consider other payroll systems.
Who is Rippling Best For?
Rippling is one of the best HR payroll software for US-based companies with divisions in other North American countries.
Pros
- Flexible modular pricing
- Option to add other HR, IT, and finance products
- Over 500 integrations
- Very customizable
Cons
- No upfront pricing
Remofirst — Best for Remote Companies
| Free Trial | Free demo |
|---|---|
| Price From | $25/month |
| Mobile Compatibility | No |
| Countries Available | +180 |
Why I Picked Remofirst
Remofirst is perfect for remote companies looking to hire internationally. It offers extensive global coverage in over 180 countries and automates payroll, making it easier to manage a distributed workforce. Remofirst acts as the Employer of Record, handling taxes, compliance, and onboarding, which I think can save businesses a lot of time and effort.
What I find impressive is the platform’s cost-effective pricing and fast onboarding process, allowing businesses to hire globally without setting up local entities. While Remofirst excels for remote teams, I think businesses that focus on domestic operations might find it more than they need.
Remofirst Pricing
You can find two main plans on Remofirst with a fixed monthly rate:
| Remofirst Plans | Monthly |
|---|---|
| EOR | Starts at $199/month |
| Contractors | $25/month |
- EOR – A combination of HR, payroll, and hiring features as part of the third-party service.
- Contractors – Onboarding and payments for international freelancers.
Remofirst gives you the option to add equipment provisioning and visa services. The price is based on your requirements.
Who is Remofirst Best For?
Remofirst is best suited for remote teams as you can pay employees in 180+ countries using locally compliant contracts.
Pros
- Extensive global coverage
- Competitive pricing
- No setup fee
- Generous discounts
- Intuitive interface
Cons
- Limited HRIS features
- Lacks integrations
OnPay — Best Budget-Friendly Payroll Option
| Free Trial | 30-day free trial |
|---|---|
| Price From | $40/month + $6/user/month |
| Mobile Compatibility | iOS |
| Countries Available | US only |
Why I Picked OnPay
OnPay is the best budget-friendly payroll solution, offering straightforward essential payroll features at an affordable price point. It excels in its simplicity and transparent pricing, making it easy for businesses to get started with payroll processing. I found the platform to be great for beginners, as it’s easy to master and doesn’t charge you for employees who aren’t paid in a given month, leaving room for mistakes on your part. However, OnPay lacks some advanced HR functionalities found in larger providers like ADP and Paychex.
OnPay is the cheapest payroll software for small business owners if you’re in the market for a full-service payroll solution. That means you can rely on OnPay to handle tax and payroll, including complex tasks like deducing garnishments or unemployment insurance withholding.
Compared to Rippling and QuickBooks, OnPay offers a more streamlined payroll experience but may not be suitable for businesses requiring in-depth HR management capabilities or advanced reporting features.
OnPay Pricing
OnPay has a single, transparent pricing plan that costs $40/month. In addition, you’ll be paying $6/month for each employee, up to 1,000 employees. This makes it an excellent pick for growing businesses seeking a solution that combines efficiency and affordability.
Who is OnPay Best For?
OnPay is the best affordable small business payroll software. This makes it suitable for startups and small companies that are looking for a cost-effective solution.
Pros
- Transparent pricing
- Unlimited payroll runs
- User-friendly platform
- PTO calendar and reminders
- Pay-as-you-go policies
Cons
- Fewer integrations than most of its competition
Paychex — Best for Flexibility and Simplicity
| Free Trial | Free demo |
|---|---|
| Price From | Custom |
| Mobile Compatibility | Yes |
| Countries available | US only |
Why I Picked Paychex
Paychex is the best choice for flexibility and simplicity in payroll management, providing a reliable and user-friendly solution for businesses. I found the dashboard to be intuitive, showing you current and upcoming pay periods so you’re always informed. What I like most is the automatic tax administration, which calculates and files your taxes, taking the hassle out of tax season.
Paychex also offers a mobile app where you can run payroll, approve PTO, and update information, which I think adds a lot of convenience. Its employee self-service feature further streamlines operations, but businesses needing only basic payroll might find Paychex’s wide array of features more than necessary.
Paychex Pricing
All of the plans and modules on Paychex have custom pricing. There are three payroll bundles, such as Select, Pro, and Enterprise, aimed at different business types.
- Select – This plan suits small businesses and provides features like direct deposit pay solutions like card, credit, and on-site check printing.
- Pro – This plan offers more workforce management features like unemployment and workers’ comp services. You also get a general ledger to quickly transfer payroll data to accounting software to create customizable and flexible reports and improve your business operations.
- Enterprise – Besides the features above, you can access performance and document management. You can also access the payroll preview, which helps you reduce payroll discrepancies and costly corrections.
Paychex Flex does not offer a free plan or trial.
Who is Paychex Best For?
Paychex Flex is best for small businesses wanting an easy-to-use payroll system.
Pros
- Wide range of integrations
- Extensive HRIS features
- Multiple payroll schedules
- Dedicated 24/7 support
- Intuitive interface
Cons
- No upfront pricing
- Limited features in the basic plan
Bambee — Best for Dedicated Expert Guidance
| Free Trial | No |
|---|---|
| Price From | $99/month |
| Mobile Compatibility | No |
| Countries available | US only |
Why I Picked Bambee
Bambee is the top choice for businesses seeking dedicated expert guidance in HR and payroll management. What sets Bambee apart is its affordable payroll service combined with personalized HR support, ensuring that federal, state, and local taxes are automatically managed.
It’s affordable, and what I really like is that each business gets a dedicated HR manager who handles onboarding, payroll, compliance, and more. This expert support ensures you stay compliant with labor laws and have help with employee issues.
Bambee also takes care of creating and enforcing HR policies, saving managers from administrative burdens. I think it’s particularly great for businesses that need ongoing HR support.
Bambee Pricing
Bambee has five paid plans based on your number of employees. If you exceed the upper limit, you can get custom pricing and choose the features you need.
| Pricing Plan | 1 Month | Set-up Fee |
|---|---|---|
| No employees yet | $99/month | $0 |
| 1-4 Employees | $299/month | $500 |
| 5-19 Employees | $399/month | $500 |
| 20-49 Employees | $499/month | $1,500 |
| 50-70 Employees | $1299/month | $2,000 |
- No employees yet – This is a budget-friendly plan that’s designed to establish businesses and help them create a compliant hiring policy. With this plan, you’ll have access to the Bambee HR software, a select number of policies, and fundamental customer support.
- 1- 4 Employees – This is suitable for small businesses with 1 to 4 employees seeking tools to manage HR processes. Its features are similar to the previous plan but cater to more employees. Here, you have a $500 one-off setup fee, and you can gain access to six policies and a dedicated HR manager.
- 5 – 19 Employees – This plan manages up to 19 employees. Its features are similar to the previous plans, but you get up to four policies, and the set-up fee is still $500.
- 20 – 49 Employees – The main difference is that you get access to eight custom HR policies, but the price jumps by $100/month compared to the previous pricing tier, and the set-up fee is now $1,500. That makes the 20-49 employee tier quite expensive.
- 50 – 70 Employees – This plan suits businesses needing dedicated HR assistance to manage their operations. Its one-time set-up fee is $2,000, and offers 12 custom HR policies.
Each plan has a one-time setup cost except the ‘no employees yet’. The total depends on how many users you need to onboard. Also, there’s no free plan or trial.
Who is Bambee Best For?
Bambee is suitable for small businesses with up to 70 employees who require dedicated payroll support thanks to the platform’s guided payroll service.
Pros
- Policy management features
- Personalized HR support
- Choice of support options
- Automated staff training
Cons
- Setup fee for most plans
- Limited features and integrations
- Not suitable for large businesses
Paycor — Best for Automating Manual Payroll Tasks
| Free Trial | Free demo |
|---|---|
| Price From | Custom |
| Mobile Compatibility | Yes |
| Countries available | US only |
Why I Picked Paycor
I think Paycor is perfect for businesses wanting to automate payroll tasks. It reduces manual work by automating tax calculations, payment scheduling, and reporting, which I found saves time and cuts down on errors. Paycor also integrates multiple HR functions, like benefits administration and onboarding, into a single platform, streamlining processes.
Its comprehensive approach helps businesses access tools without needing multiple systems, which I think is a huge advantage. For companies looking to manage payroll efficiently while automating HR tasks, Paycor is a strong choice. However, I found that it was a bit complicated to get the hang of initially. With that in mind, I’d recommend Paychex over Paycor for startups and beginners.
Paycor Pricing
Paycor requires you to contact them for a quote. However, they have published their four payroll plans online.
- Basic – Tools to pay and file taxes for employees compliantly.
- Core – Everything in Basic plus hiring and onboarding tools.
- Essential – The addition of employee engagement and development features.
- Complete – Access to advanced analytics and development tools.
You can add time tracking, benefits, and recruitment tools to any of the plans. There’s often a discount for signing up like 50% off for six months.
Who is Paycor Best For?
Paycor is the best small business payroll software for experienced companies looking to streamline the payroll process with automation.
Pros
- Unlimited payroll runs
- Employee enablement tools
- Flexible modular pricing
- On-demand pay
Cons
- No upfront payroll software pricing
- Setup fee
QuickBooks — Best for Integrated Payroll
| Free Trial | 30-day free trial |
|---|---|
| Price From | $75/month + $6/user/month |
| Mobile Compatibility | Yes |
| Countries Available | US only |
Why I Picked QuickBooks
QuickBooks provides a versatile online payroll solution for small businesses, integrating payroll seamlessly with accounting and HR functions. It offers a comprehensive suite of tools for managing finances, including payroll processing, expense tracking, and reporting.
While testing its interface, I noticed you need to make just one successful payroll run to be eligible for its auto payroll feature, which lets you set up scheduled payrolls.
QuickBooks stands out for its integration capabilities and ease of use, making it suitable for businesses looking for an all-in-one financial management solution. However, compared to ADP and Gusto, QuickBooks may lack some HR-specific features and dedicated support for compliance, which could be a drawback for businesses with complex HR needs. It also requires you to add each function to your plan, unlike Rippling where you get all functionality on the same plan.
QuickBooks Pricing
When you opt for QuickBooks Payroll you can choose from the below subscription plans. Please note, the below pricing is if you select to try it free for 30 days.
| QuickBooks Plans | Monthly |
|---|---|
| Payroll Core + Simple Start | $75/month + $6/month per employee |
| Payroll Core + Essentials | $105/month + $6/month per employee |
| Payroll Core + Plus | $170/month + $8/month per employee |
You also have the option to ‘buy now’ and save 50% for your first 3 months.
Although I’m impressed with its intuitive interface and the speed and accuracy of its payroll service, QuickBooks offers fewer features than most of its competition on its cheapest plan. That’s because most of its advanced features, including time and project tracking and HR features, are reserved for its more expensive plans. That said, it’s one of the only leading payroll services to offer a lengthy free trial, allowing you to try its services risk-free.
Who is QuickBooks Best For?
QuickBooks payroll is the best choice for businesses that already use QuickBooks for their accounting and HR.
Pros
- Next-day and same-day direct deposit
- Tax penalty protection with its most expensive plan
- Well-designed, customizable reports
- Available in all 50 states
Cons
- More expensive than most of its competition
ADP — Best for Scaling Businesses
| Free Trial | Free demo |
|---|---|
| Price From | Custom |
| Mobile Compatibility | Yes |
| Countries available | US only |
Why I Picked ADP
ADP Workforce Now is best for growing businesses due to its scalability. Its automation tools make managing payroll for a growing team easy, and I like how it lets you set up complex permissions for different departments. ADP’s modular pricing allows you to add features as your business expands, which I think is incredibly helpful for scaling.
It also simplifies compliance with an advanced dashboard and offers industry-specific solutions. I believe ADP’s wide range of features makes it ideal for larger, scaling businesses, but it might be more than what smaller companies need.
ADP Pricing Plans
ADP Workforce Now has custom pricing based on your business size and requirements. They have three plans which all include payroll and tax filing:
- Select – A range of features including HR, onboarding, document management, and employee engagement.
- Plus – Everything in the Select plan and benefits administration.
- Premium – Access to workforce management tools like scheduling, time tracking, and TO management.
There’s a range of additional modules concerning employee management and development. You can add them all to any plan.
Who is ADP Best For?
Growing US businesses can benefit from ADP Workforce Now’s scalable payroll solution. You can onboard new employees without exponentially increasing your costs or burdening the finance team.
Pros
- Comprehensive basic plan
- All payroll features included in every tier
- Flexible modular plans
- Wide range of integrations
- Customizable features
Cons
- No upfront pricing
- Steep learning curve for beginners
Gusto — Best for US Business Tax Compliance
| Free Trial | 3 months free trial |
|---|---|
| Price From | $40/month + $6/month per person |
| Mobile Compatibility | Yes |
| Countries available | 120+ |
Why I Picked Gusto
Gusto is the best payroll solution for US businesses focused on tax compliance. It automates payroll and keeps accurate records of I-9s, W-2s, and 1099s, making tax season a breeze. I like how businesses can set payroll on autopilot, and its multi-state support is especially helpful for companies with employees in different locations.
Gusto also offers financial tools like its Wallet app, which I think helps employees manage their earnings and build better financial habits. For businesses focused on US payroll and compliance, I believe Gusto offers the perfect balance of simplicity and thoroughness.
Gusto Pricing Plans
Gusto has three main pricing plans to support businesses. See the table below for the full list.
| QuickBooks Plans | Monthly |
|---|---|
| Simple | $40/month + $6/person |
| Plus | $80/month + $12/person |
| Premium | $135/month + $16.50/person |
- Simple Plan – This offers streamlined automatic payroll, benefits integration, employee self-service, basic hiring tools, and more—all essential for single-state operations.
- Plus Plan – This builds on the Simple plan with advanced features like multi-state payroll, comprehensive HR tools, time tracking, and performance reviews, all ideal for growing businesses.
- Premium – Gusto’s Premium plan offers more features like compliance alerts, access to certified HR experts, health insurance broker integration and more. It’s suitable for businesses with advanced payroll needs.
While Gusto doesn’t offer a forever free plan, it offers a three-month free trial, providing opportunities to explore the system.
Who is Gusto Best For?
Gusto is suitable for growing businesses in the US that need payroll software to manage employee payments in other states and ensure tax compliance.
Pros
- Offers fast payroll processing
- Integration with business tools like Clover and QuickBooks
- Offers multi-state payroll for US businesses
- Provides employee financial benefits
Cons
- There’s no free plan
- Priority support is not available on the basic plan
- Limited reporting customization
- Lack of automated workflow
The Best Payroll Management Software Compared
To provide an at-a-glance comparison of the payroll providers on my list and their offers and features, I’ve created a comprehensive master table so you can compare each payroll product side by side.
| Software | Best For | Starting Price | Free Trial | Countries Covered |
|---|---|---|---|---|
| Deel | Global payroll | $49/month | ✅ – Demo | 150+ |
| Rippling | US and Canada | $8/month | ✅ – Demo | 50+ |
| Remofirst | Remote companies | $25/month | ✅ – Demo | 180+ |
| OnPay | Affordable payroll | $40/month + $6/user/month | ✅ – 30-day free trial | US only |
| Paychex | Simplicity | Custom | ✅ – Demo | US only |
| Bambee | Expert guidance | $99/month | ❌ | US only |
| Paycor | Automation | Custom | ✅ – Demo | US only |
| QuickBooks | Integration | $75/month + $6/user/month | ✅ – 30-day free trial | US only |
| ADP | Scaling businesses | Custom | ✅ – Demo | US only |
| Gusto | US tax compliance | $40/month + $6/month per person | ✅ – 3 months | 120+ |
How We Review And Test Payroll Products
To provide our readers with accurate and well-informed recommendations, we test the most popular payroll products on the market to find the best options for you. Our methodology consists of the following criteria:
- Features: We examine the features to determine what capabilities are offered, how useful those capabilities will be for the user, and how the variety of features compare to competitor software.
- Scalability: We look at how many users can be added to a platform, and how easy it is to do so, to ensure companies can bring more employees on payroll with ease as they scale their operations.
- Error Handling: Errors in payroll can be disastrous for a company, so it’s critical payroll software safeguards against them. We evaluate how quickly each software can adjust and fix errors to ensure there are no interruptions in payroll operations.
- Price and Value for Money: We look at the features, integrations, customer service, and extras to determine if the price matches the value it provides. We score a product higher if it offers a free trial, and if it is transparent about its pricing plans.
- Integrations: We evaluate the integrations of each piece of software to determine how well it fits in with other key pieces in a business’s software stack, and whether its functionality can be expanded as required.
- User Experience: We get hands-on with each product to put ourselves in the shoes of a new user, testing each platform to gain understanding if the platform is easy to use or requires onboarding.
- Security: We dig into the security policies of each company, interrogating the safeguards they have in place to ensure the software protects user data properly.
- Compliance: We evaluate payroll software based on whether it offers local compliance when it comes to accounting, taxes, documentation, and more.
How Does Payroll Software Work?
Running payroll is complex and involves many backend calculations and compliance assurances. Most payroll software is a combination of different tools and processes. Either you input employee data or the system collects it from other platforms. Then, it automatically calculates wages and taxes based on your location.
Manual Payroll Solutions:
To calculate payroll manually, you will need to track the time worked by each employee and calculate the related payroll tax, like employee benefits or other tax withholdings. Lastly, you must pay employees manually and note down when and how they were paid.
Automated Payroll Solutions:
If you’re using one of the best payroll software solutions, the tool will calculate the labor cost (with multiple pay rates if required) and tax deductions. Many systems also have an employee self-service payroll app where the employees can receive their pay stubs (that only need approval from your finance team to process). You can also improve business processes with customizable payroll reports and centralized tax documents and feel relief knowing you have a dedicated customer success manager on hand if needed.
To learn more about the process, read our article on how to do payroll.
Trends in Payroll Software for 2024
As technology advances, HR and payroll software continue to evolve. Here are the top 5 trends in payroll software in 2024.
- AI and Automation: AI integration is becoming an essential part of payroll software as it helps automate complex data processing to ensure accurate calculation quickly.
- Data Security: Cyber attacks continue to increase as devices advance in operation and interaction with the internet. As a result, payroll software is implementing high-end cybersecurity measures such as two-factor authentication, industry-standard encryption, and blockchain technology.
- Remote Work: Work flexibility has influenced payroll software to support global payment functions. Many payroll software like ADP Workforce Now can handle multiple currency payment options using different payment methods.
- Payment Flexibility: Many payroll software have adapted multiple payment options into their system to support the growing needs of users with unique requirements.
- Employee Wellness: There is a growing need to support employees’ wellness, and many payroll software are implementing employee benefits and compensation into their systems.
How Much Does Payroll Software Cost?
Payroll software costs can vary widely depending on the included features and size of your business. Basic payroll services often start at around $10-$20 per month, while more extensive solutions range from $100 to several hundred dollars monthly.
The main factors that affect pricing are number of employees, frequency of payroll runs, and advanced functionality such as tax filing, direct deposit, and integration with other HR systems.
| Plan Type | Basic | Standard | Premium | Enterprise |
|---|---|---|---|---|
| Average Cost | $10-$20 | $30-$100 | $100-$300 | $300+ |
| Features | Payroll processing, direct deposit, support | Tax filing, employee self-service, reports | Advanced analytics, HR integration, support | Customization, dedicated support, compliance |
| Best Suited For | Small businesses, startups | Medium-sized businesses | Large businesses, enterprises | Large enterprises, complex needs |
Paid vs Free Small Business Payroll Software
There are many options for free payroll software for small businesses, like HR.my or Payroll4Free. While the free options often cover fundamental features such as payroll, time tracking, and PTO, they often lack the standout features you’d find with a paid plan (like tax filing, customer support, and detailed reporting). Paid software solutions are typically easier to use and more reliable, they guarantee payroll accuracy, and allow you to automate the bulk of repetitive tasks. They are also, generally, far more secure to use.
If you’re not sure whether to choose a paid or free solution, one option is to test a paid alternative using a free trial. This way you have the opportunity to see for yourself if the solution is easy to use, and overall how it works with your business demands. Upgrading from a free plan is always easy. You can even sign up for free trials with different payroll providers and compare them first-hand.
How to Choose Payroll Processing Software
Integrating a payroll service into your small business can transform your operations and improve efficiency, accurate recordkeeping, and compliance.
Automated calculations, streamlined tax management, and error reduction are just some of the benefits payroll systems offer, and they can help you focus on your business by reducing admin.
Unlike manual payroll calculations, the best processing software for small businesses isn’t susceptible to human error, which can result in overpayments, underpayments, and compliance issues. Payroll solutions can simplify complex calculations, such as tax withholding and deductions, in minutes.
In addition, payroll software stays up-to-date with ever-changing tax and legal regulations that apply to different industries. That means you can rest easy knowing your payroll software calculates employee taxes accurately, preventing potential penalties and fines for non-compliance.
Some payroll companies will also warn you about inconsistencies, such as conflicting or missing data, alerting you to potential issues stemming from manual data entry.
Leveraging payroll software for tax compliance can help your small business mitigate the complexity of tax management and ensure you meet all your tax obligations accurately and on time. It can generate and file necessary tax forms, including W2s and 1099s, reducing the risk of costly errors in tax reporting and saving you time.
The best payroll system for small business owners can also help reconcile payroll tax deposits and provide records for audits. In addition, it gives you peace of mind knowing that it can calculate the correct amount for each employee’s paycheck based on their preferences and tax rates.
Considering integration capabilities is crucial when comparing the best payroll companies for small business owners.
Since payroll closely connects with other aspects of your business, such as accounting, human resources, and time tracking, finding a solution that seamlessly shares data with your other business solutions can help with time management.
For example, integrating your payroll software with the best accounting software for small business ensures tax calculations and filings are synchronized, minimizing compliance risks and inconsistencies.
The best payroll services for small business owners offer comprehensive reporting features that can provide actionable insights. For example, you’ll get valuable visibility into your labor costs, payroll performance, tax liabilities, and other metrics.
Depending on your payroll software, you’ll have a variety of customizable reports to tailor to your business’s needs. For example, you can track employee attendance, benefits utilization, overtime trends, and more. This provides a detailed view of your staffing and costs, allowing you to make better business decisions.
Opting for a mobile-compatible payroll solution lets you access and manage various payroll-related tasks while on the go. This allows you and your team managers to stay connected to your workforce, even when away from the office.
In addition, real-time access to payroll data ensures you can approve a payroll run anywhere, make last-minute adjustments, and address issues.
One significant advantage of having a payroll solution with mobile accessibility is the ability to access employee self-service portals. This feature, typically found in full-service payroll systems, helps your employees view their pay stubs, benefit information, and tax forms via the provider’s mobile app or website.
Conclusion – What is the Best Payroll Software for Small Business Needs?
In my view, the best payroll software for small businesses depends on your unique needs. For example, Deel is unbeatable for global payroll, but QuickBooks is a much better option for businesses that are already using the software for their accounting. Bambee provides dedicated expert guidance, which is key for businesses needing hands-on support. However, if affordability is your top consideration – OnPay is your best payroll option.
FAQs
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References
- Workforce Management, HR, Payroll & Wellbeing – Unified (Intellihr)
- Just a moment… | Gartner (Gartner)
- Workplace Wellbeing Initiative Trends for 2024 – Global Wellness Institute (Globalwellnessinstitute)
