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Running payroll requires dozens of one-off tasks, advanced calculations and comprehensive organization. Adopting a payroll software solution is a great way to take that work off your already busy plate as a small business owner while also guaranteeing accuracy and compliance with tax laws.

But, not all software is created equal. Some on this list are better fit for certain types of small businesses while others offer a broad approach that fits many different needs. We compared everything from pricing to features to customer reviews from 19 industry leaders to find the best payroll software for small business in 2024.

Best payroll software

Why trust our small business experts

Our team of experts evaluates hundreds of business products and analyzes thousands of data points to help you find the best product for your situation. We use a data-driven methodology to determine each rating. Advertisers do not influence our editorial content. You can read more about our methodology below.

  • 25 companies reviewed.
  • 1,025 data points analyzed.
  • 100+ hours of research.

Best payroll software comparison

 New hire reportingVacation/leave trackingTime trackingBenefits administrationPhone customer supportLearn more
Rippling
Yes
Yes
Yes: Certain plans
Yes: Certain plans
No
Patriot Software
Yes
Yes
Yes: Add-on
No
Yes
Homebase Payroll
Yes
Yes
Yes
No
Yes
Gusto
Yes
Yes
Yes
Yes
Yes
Workful
No
Yes
Yes
No
Yes
OnPay
Yes
Yes
Via integration only
Yes
Yes
Payroll4Free
No
Yes
Via integration only
No
Yes
QuickBooks Payroll
Yes
Yes
Yes: Add-on
Yes
Yes
Roll by ADP
Yes
No
No
No
No
Wave Payroll
Yes
Yes
No
No
No

Methodology

We extensively research the key competitors within an industry to determine the best products and services for your business. Our experts identify the factors that matter most to business owners, including pricing, features and customer support, to ensure that our recommendations offer well-rounded products that will meet the needs of various small businesses.

We collect extensive data to narrow our best list to reputable, easy-to-use products with stand-out features at a reasonable price point. And we look at user reviews to ensure that business owners like you are satisfied with our top picks’ services. We use the same rubric to assess companies within a particular space so you can confidently follow our blueprint to the best payroll software of 2024.

Expert score (10%): Our expert score weighs everything from cost to benefits to usability, comparing first-hand customer experience with our industry expertise. Together, we use this insight to rank the best payroll software.

Pricing (30%): While we compare general pricing structures, we really are looking for the value a payroll software offers small businesses rather than just who is the cheapest. That means we compare features with pricing, plus look at additional benefits like 24/7 support, free trials or more that can offset any price discrepancies.

Features (38%): In addition to making sure the software offers all the appropriate payroll features, like direct deposit and reporting, we also compare additional tools or integrations that make it stand out from the pack.

Service and support (4%): Business owners may want to contact support in various ways, so we look for those that offer more than just one method of communication. We test how quickly the company responds and whether or not a business owner can trust timely and reliable support.

Customer reviews (14%): Real customer reviews are imperative to our results, as we can only test so much without having a real business and real employees to pay. We search reputable review sites like Capterra, G2, Trustpilot and Reddit to gain a broad understanding of what customers like and don’t like when using a platform.

Mobile app (4%): Mobile apps benefit you as a business owner and your employees. A good mobile UX adds a lot of value to software, such as faster adoption of business practices, more accurate information and streamlined onboarding.

What is payroll software, and how does it work?

Payroll software is a business application companies and HR professionals use to run payroll, cut paychecks and send direct deposits. It automatically calculates wages and withholding amounts (including taxes and benefits deductions). Payroll services can also automate tax filing by submitting payroll taxes and forms to local, state and federal agencies, although this isn’t always included in the cost. Most also allow businesses to process payroll for independent contractors and employees.

Traditionally, on-premise solutions were more prevalent. But today, many organizations prefer cloud-based payroll systems, which allow employers and employees to access payroll data from desktop and mobile devices. If tax or labor laws change, many internet or cloud-based payroll software will automatically update to ensure compliance. 

In some cases, the platform may extend into other areas of your business operations, such as benefits administration, wage garnishment, child support withholding and unemployment insurance. 

Since most payroll (but not all) solutions integrate with time tracking and accounting software, business owners can reduce manual data entry by syncing payroll ledgers and attendance information. Moreover, the best payroll software for small business provides employee self-service (ESS) portals, which give staff access to pay stubs and end-of-year tax forms.

Payroll processing 

A payroll platform typically includes a dashboard with a tab or menu listing payroll functions. It often pulls data like wage rates and benefit deduction amounts from your chosen database (whether it’s integrated into the platform itself or as a third-party integration like QuickBooks,) so you won’t need to enter this information every pay period. 

For example, if you use a payroll service with built-in time tracking like Homebase or integrate it with your point-of-sale (POS) system, the payroll software will automatically sync employees’ work hours into the pay period and auto-populate the fields for an accurate payout come payday.

Tax filing and payments

Running taxes is often a full-time job. Luckily, some providers automatically remit tax payments to government agencies on your behalf. If included in service, the payroll software will automatically withhold federal, state and local payroll taxes from your employee’s wages and submit the amount (along with your company’s tax liability) to the correct agencies when required. 

Some additional tax services include:

  • Preparing and filing Forms 940, employer’s annual federal unemployment (FUTA) tax return and 941, employer’s quarterly federal tax return.
  • Remitting federal tax deposits (FTDs) and federal tax payments for the amounts reported on Forms 940 and 941.
  • Completing and submitting annual W-2s and 1099s for employees and contractors.

In some cases, this is included in the price or in others, like with Patriot, it’s only in a top-tier plan. If your business requires more unique forms, like Form 943 for farm workers, consider a company like OnPay that offers specialized services at no additional cost.

Benefits of payroll software

Even for a small business owner with only a handful of employees, running payroll can still be a hassle. Implementing payroll software can help take the job of paying your employees off your plate while also ensuring you’re in compliance with rules, regulations and best practices.

  • No need to hire a payroll expert. While larger companies need a payroll specialist on staff to handle all the intricacies the process includes, small teams can benefit from many of those same skills within paid payroll software. 
  • More accuracy. Payroll software does the math and heavy lifting for you to make sure there are fewer mistakes or delays in payments — which makes everyone happy.
  • Enhanced compliance. Put down the tax law book. Most software today can integrate local compliance and tax laws into the system to make sure your business is in constant compliance. 
  • Convenience for your employees. Obviously, payroll software is a huge benefit to you as an owner. But it also gives your employees the ability to access and update their data (without having to include you in the process), which is a win-win for everyone.
  • Enhanced security. If you’re still running manual payroll, all your data is left open for data and security risks. Most payroll software today includes enhanced security features that protect your employee and personal data more efficiently and effectively.

Who needs payroll software?

Do you ever feel like there just aren’t enough hours in the day to do everything required of you as a small business owner? Do you want to take payroll off your to-do list, but don’t have the budget to hire another employee just for this one task? Start outsourcing some of your more mundane tasks — like payroll — to software instead. 

Most business owners can benefit from payroll software, but this is especially true for small business owners who already wear a lot of hats. If you’re looking for ways to maximize your time without putting your business or employees on the back burner, implementing payroll software is a great place to start.

How to choose the best payroll software

Payroll software functions similarly but vary in ease of use, features and pricing. Some work better for small businesses in niche industries, like restaurants or farms. Others function as an all-in-one HR and payroll platform with built-in document storage and onboarding tools. 

Find the right fit for your company by assessing your current payroll challenges and goals and then using this information to identify your ideal payroll software and its feature set. Many small businesses switch to online payroll systems to save time and reduce errors. But your company may also want to improve employee experiences by offering direct deposit and an online employee portal. Conversely, you may be looking to hire more remote staff and need a service that can handle multi-jurisdiction payroll. Your choice of provider should align with your ultimate goals.

List the factors that affect your payroll software decision, such as:

  • Budget: Determine how many employees and contractors you will pay regularly. Use this to estimate your per-person fees and decide how much you can afford for monthly payroll expenses.
  • Industry-specific needs: Decide if you need support for the FICA tip credit, agricultural worker tax filings or non-profit unemployment tax exemptions. Also, some payroll providers assist with the federal R&D tax credit.
  • Location: Consider if your company requires multi-state payroll or benefits administration. Not all full-service payroll platforms work in all 50 states. In addition, some payroll providers offer global payroll processing in multiple currencies. 
  • Payment types: Note if your software can support bonuses, expense reimbursements or commissions. 
  • Deductions: Write down what types of deductions your payroll system must calculate, including any flex or fringe benefits. 

You’ll also want to determine how much support you may need during onboarding and beyond. If your staff is relatively tech-savvy and comfortable working with new platforms, then an all-digital self-onboarding system like Gusto may be perfect. However, a solution like OnPay that offers extra migration assistance may work better if you prefer more hands-on support. 

Some payroll providers also offer professional employer organization (PEO) services, which outsource payroll, HR and benefits administration processes completely.

Past just onboarding, payroll services also differ in how they provide customer support. For example, payroll clients can contact Wave by a form and live chat, whereas QuickBooks Payroll offers live chat, callbacks or a toll-free phone number (with restricted hours based on plan type). 

Key features to look for

The biggest decision you should make is whether you want self- or full-service payroll for tax filing purposes. Wave, Payroll4Free and Patriot have self-service plans that cost less than full-service systems because your business handles the tax filing paperwork and payments. In contrast, Rippling offers full-service tax filing globally.

After deciding which type of service you want, involve your HR and payroll staff to learn which features would help them do their jobs better. Your team managers can also advise on tools that support your workforce. 

Consider the following options:

  • Employee payment methods: In addition to printing paper checks or receiving direct deposits, payroll systems may support prepaid debit cards, on-demand pay or printing and delivering paychecks.
  • Annual tax filing: Depending on the composition of their workforces, employers must file W-3, 940, W-2, 1099-NEC and 1099-MISC forms to the Social Security Administration (SSA) and provide copies to employees or contractors. Payroll services may generate and file the documents with government agencies and provide digital copies to staff. 
  • Quarterly tax filing: Businesses that paid wages subject to payroll taxes must file Form 941 and remit the taxes due. Full-service payroll systems can automatically withhold payroll taxes, file tax forms and send payments on a business’s behalf.
  • Payroll reports: See what types of analytics your team requires and if they want basic spreadsheets or advanced data visualization tools. Common payroll reports include wage and tax summaries, tax liability overviews, payroll summaries and deductions and contribution overviews. 
  • Mobile access: If you or your payroll staff want to run payroll or view reports from mobile devices, look for services like Roll by ADP that offer mobile apps or mobile-friendly websites.
  • Workers’ comp administration: Decide if your business wants to integrate workers’ compensation management into payroll, meaning the system would send employment data to carriers and deduct premiums during each pay run.
  • Employee apps and portals: Consider what tools your staff needs to manage their personal data, like paystubs, year-end tax forms and time-off balances. 

Add-ons and extras

Although not all payroll software includes HR features, some small businesses want an all-in-one system. However, these tools typically come on higher-priced plans. Kelly Hopper, QuickBooks Certified ProAdvisor, bookkeeper and payroll specialist, cautions entrepreneurs to avoid paying extra for expanded HR capabilities if your team doesn’t use or won’t need them. 

But, if you want a single platform for document signing and storage, benefits administration and management, and employee onboarding, consider providers like OnPay, Gusto or Rippling. 

HR features and add-ons may include the following:

  • PTO management.
  • Accrual tracking.
  • New hire reporting.
  • Organizational charts.
  • HR templates and resources.
  • Employee management.
  • Job listings.
  • Offer letter templates.
  • Applicant tracking.
  • Onboarding checklists.
  • 401(k) plans and administration tools.
  • Health and dental benefits and management.
  • Flexible savings account administration tools.

Software integrations 

Accounting and time-tracking integrations can save time and reduce errors. In fact, businesses “spent 26 minutes per employee” resolving incorrect and missing time punches in the last fiscal year, according to the Ernst & Young survey. By selecting software that syncs with your time and attendance tools, you won’t need to enter hours manually each pay cycle. 

Alternatively, Hopper suggested seeing if the payroll software integrates with your POS system. She said, “Employees can clock in and out on your POS system and ultimately save you a lot of time by preventing manual data entry errors.” However, “check with your POS provider also, as some payroll providers say the payroll and POS integration is seamless, but it’s not always true,” cautioned Hopper. 

Hopper also stressed the importance of accounting integrations. “While QuickBooks offers payroll services within the accounting program, most other payroll apps sync with QuickBooks, including Gusto and Roll by ADP. You just set the parameters, download the file, and upload it into QuickBooks.” For other accounting programs, Hopper recommended “double checking to ensure the payroll software and accounting programs accept CSV and XLSX formats, which are pretty standard.”

“Automating your payroll with reliable software is a great way to save time and reduce errors. Look for systems that handle tax calculations and compliance automatically. This ensures your employees are paid correctly and on time, helping to keep them happy and reducing the stress of payroll management — all while keeping your books in order so that when tax time rolls around, everything is straightforward and simple.”

– Bryce Colburn, Lead Editor

How much does payroll software cost?

 Base monthly feePer employee feeFree trial of any paid planFree version availableLearn more
Rippling
Varies
$8
No
No
Patriot Software
$17
$4
Yes
No
Homebase Payroll
$39
$6
Yes
No
Gusto
$40
$6
No
No
Workful
$35
$6
Yes
No
OnPay
$40
$6
Yes
No
Payroll4Free
$0
$0
No
Yes
QuickBooks Payroll
$45
$6
Yes, for existing QuickBooks customers
No
Roll by ADP
$39
$5
Yes
No
Wave Payroll
$20
$6
Yes
No

Most payroll services fall into one of three pricing models:

Full-service plans

Full-service payroll plans are comprehensive and take care of all payroll-related tasks for customers. They charge a monthly subscription fee plus a fee per employee or contractor. There may be different tiers of plans. 

Lower-tier plans typically provide basic payroll services, while higher-tier ones may incorporate HR tools and other priority support. Full-service payroll software costs $17 to $45 monthly for entry-tier subscriptions, and per-person fees cost $0 to $8. 

However, upper-tier payroll packages can cost much more. For example, Gusto’s Plus plan is $80 plus $12 per employee monthly, whereas QuickBooks Payroll Elite is $125 plus $10 per person monthly.

Self-service plans

Self-service payroll plans are typically cheaper than full-service ones but require more legwork from the customer. Typically, with these plans, the employer will be responsible for tasks like withholding taxes. 

Self-service payroll software pricing ranges from free to $20 monthly. Providers with self-service options include Payroll4Free, which doesn’t charge any per-person fees for companies with 10 or fewer employees, whereas per-person rates are $4 per month through Patriot Software and $6 per month through Wave Payroll. 

Contractor-only plans

For employers that only use contractors rather than W-2 employees, a contractor-only plan is worth considering. Two of the best payroll software providers (Gusto and QuickBooks) offer contractor-only subscriptions. These plans are less expensive than full-service payroll systems for employee payments.

Additional payroll processing and service fees

Besides monthly and per-person costs, some payroll service providers charge fees for add-ons and other services. Always review the terms before signing up for a new payroll service and request written clarification for any fees that seem out of place. 

Fees to look out for include the following:

  • Benefits administration fees: Some payroll companies charge service fees on top of your monthly premiums. In addition, you may pay a fee to bring your own health care broker. 
  • Annual tax form fees: If you want the payroll system to file and mail W-2 and 1099 forms, there may be additional charges.
  • Setup fees: Payroll services may require a one-time payment to migrate from another payroll platform, configure integrations, train employees or get onboarding assistance.
  • Other payroll services: Payroll providers may offer check printing and mailing (check stuffing) for a per-envelope fee or charge more for expedited direct deposits.
  • Extra employees: Some payroll providers put a cap on the number of employees who can be paid per month, then charge an extra fee for each employee above that cap. 

What we don’t recommend

Outsourcing payroll is a big decision and the wrong choice can cause problems for your company and employees. According to the IRS, “Even though the employer may forward the tax amounts to the third party to make the tax deposits, the employer is the responsible party.” Therefore, it’s imperative to vet payroll providers carefully and review their history with clients. 

While considering payroll software services, we came across a few products that lacked essential features. Even if the application is free, businesses might face problems if they manually transfer payroll ledger data or can’t pay employees via direct deposit. 

When selecting payroll software, we suggest avoiding or, at minimum, researching further:

  • Companies that charge per pay cycle instead of offering unlimited pay runs or a reasonable amount of included pay runs.
  • Services with poorly rated mobile apps, especially those with many employee complaints.
  • Providers that charge add-on fees for integrations, direct deposit services or other functions essential to your business.
  • Payroll systems that don’t support your preferred customer service communication methods or reasonable outreach schedules. 

Regardless of your decision, Hopper recommends reading the fine print carefully and avoiding long contracts: “Some payroll services hide costs in their terms of service or charge hefty fees if you cancel before your term ends.”

Frequently asked questions (FAQs)

Online payroll services help companies of all sizes, even if you only pay yourself as the owner. While small firms may feel comfortable handling simple calculations for a handful of workers, things get more complicated as organizations add employees or contractors. Deploying a payroll system improves operations, reduces risks and supports business growth.

Here are a couple (of many) reasons businesses should have a payroll software working for them: 

  • Ensuring accurate payroll data: According to an Ernst & Young survey, on average, “a company has an 80.15% payroll accuracy rate.” And, on average, each mistake costs businesses $291. Payroll software automatically calculates wages and withholdings, reduces manual data entry and alerts admins to potential mistakes.
  • Preventing tax and compliance issues: The NFIB reported, “The Internal Revenue Service penalizes nearly one in three businesses for payroll mistakes.” Payroll software automatically updates to account for the latest regulations and remits your tax payments and forms, so your business isn’t delinquent.

Payroll platforms provide tax, compliance and security features. These tools help companies avoid substantial fines and legal issues related to payroll mistakes. Indeed, the Internal Revenue Service assessed over $13 billion in employment tax-related civil penalties in the fiscal year 2022. 

Although companies can fix errors to avoid fines, dealing with the IRS is resource-intensive. Moreover, businesses can face litigation resulting from payroll mistakes. Ernst & Young’s survey found that errors lead to job cuts, reputational decline and poor employee morale.

Aside from accurate payroll and tax filing, payroll software helps to protect your business against data breaches and helps prevent unauthorized internal access. It does so by offering accuracy guarantees, tax compliance features, error notifications, permission levels based on employees’ roles, payroll software encryption and secure storage facilities.

Some providers offer an onboarding checklist to help you set up your software. For instance, Gusto provides an onboarding overview and checklist, and you configure your account solo.

In contrast, some payroll services handle some or all of the payroll data entry for you. OnPay also has an onboarding list. But OnPay’s team enters your workers’ personal information and pay histories. 

Some payroll systems invite workers to self-onboard via an online portal or mobile app. The entered data syncs to your payroll software, eliminating the need to manually enter payroll tax exemptions and direct deposit banking information. After the initial setup, you can connect your accounting software and time-tracking tools.

A pay period is a fixed timeframe when employees earn wages for an upcoming paycheck. It has a start and end date. Pay cycles commonly recur weekly, bi-weekly, semi-monthly or monthly.

Payroll systems provide self-service and full-service options for managing payroll and employment tax obligations.

With self-service payroll, the service calculates and withholds the correct amounts from employee paychecks. But you’re responsible for filing forms and remitting payments to federal, state and local agencies. Additionally, you must submit annual tax forms.

Full-service payroll software files Forms 940, 941, W-2, and W-3 to tax agencies each quarter or at the end of the year. It also remits federal, state and local tax deposits and payments.

Several payroll service providers, including OnPay, QuickBooks Payroll and Patriot, guarantee accuracy and cover fines or penalties resulting from an error on their side.

Several payroll platforms have built-in HR features and offer add-ons, such as employee benefits and new hire onboarding. The most common HR functions found on payroll software include new hire reporting, self-service or automated new hire onboarding tools, PTO management and document storage.

While assessing the best payroll software, we found Gusto, Rippling and OnPay offer the most HR features in their base plans. Roll by ADP has new hire reporting whereas Homebase has native time tracking and scheduling tools. Our top pick, Rippling, also offers add-on modules for employee benefits administration, flex benefits and time and attendance tracking.

Yes, there are free payroll software solutions available, such as Homebase or Payroll4Free. Free payroll apps calculate wages, deductions and taxes. They provide basic features for small companies with a limited number of employees.

Typically, unpaid tools offer self-service payroll, meaning you must file and remit federal, state and local taxes yourself. Most have fewer customer service options than paid versions. However, small businesses and startups with a limited budget can ditch spreadsheets by switching to free payroll software. Plus, free payroll apps usually have employee self-service portals to remove some HR and payroll tasks off your to-do list.

Blueprint is an independent publisher and comparison service, not an investment advisor. The information provided is for educational purposes only and we encourage you to seek personalized advice from qualified professionals regarding specific financial decisions. Past performance is not indicative of future results.

Blueprint has an advertiser disclosure policy. The opinions, analyses, reviews or recommendations expressed in this article are those of the Blueprint editorial staff alone. Blueprint adheres to strict editorial integrity standards. The information is accurate as of the publish date, but always check the provider’s website for the most current information.

Taylor Sansano has more than nine years of experience writing in a variety of industries, from healthcare to education to B2B. With a background in journalism, Taylor has a passion for research and fact-checking. She is published on various websites, including Consumer Affairs, Angi, and US News and World Report.

Sierra Campbell is a small business editor for USA Today Blueprint. She specializes in writing, editing and fact-checking content centered around helping businesses. She has worked as a digital content and show producer for several local TV stations, an editor for U.S. News & World Report and a freelance writer and editor for many companies. Sierra prides herself in delivering accurate and up-to-date information to readers. Her expertise includes credit card processing companies, e-commerce platforms, payroll software, accounting software and virtual private networks (VPNs). She also owns Editing by Sierra, where she offers editing services to writers of all backgrounds, including self-published and traditionally published authors.