Best Payroll Software

For many small businesses, payroll software is an aspect that gets overlooked in the startup phase.

After all, quite a few startups have very few employees, and some don’t have any at all. For these businesses, it makes sense how payroll software isn’t a high priority.

However, we always urge entrepreneurs not to overlook this crucial component of the startup phase. While it may not seem like you need payroll software if you’re operating a single-member LLC, for example, payroll software is a must as your business begins to grow and expand. If you don’t already have a payroll system set up, it can be a tremendous hassle to get it up and running after you already need it!

What Can Payroll Software Do for Your Company?

Old-school methods for payroll tracking were incredibly time-consuming. Even small businesses needed to invest way too much time into things like calculating payroll manually, tracking hours, writing checks, and calculating taxes. Thankfully, technology has simplified this process significantly.

Today, entrepreneurs can instead pay a reasonable monthly fee to one of many payroll software services and receive automated assistance with these and other related tasks.

It can be overwhelming to try to compare the many options on your own, as there are many of these services available, and they can be quite similar, making your decision even tougher.

In this article, we’ll break down each of our seven favorite payroll software providers. We will discuss each company’s pricing and identify which broad category of entrepreneurs it’s best for. Then, we’ll dig into the details to show you what sets each of these companies apart from its competitors. Let’s get started!

The Best Payroll Software Companies for Small Business

Patriot: $10/month + $4/employee (Best for Very Small Businesses)

Pros:

• Low price points
• Unlimited payroll runs
• Integrates with accounting/time-tracking software
• Strong customer feedback

Cons:

• Need to upgrade for most advanced features

If all you need is the basics, it would be tremendously difficult to top what Patriot has to offer. Not only is Patriot the most affordable option (by far) in this guide, but it also has a surprising collection of features that make it far from just a budget option.

Patriot includes full account setup services for each customer, and they allow you to perform unlimited payroll runs. This fully featured software solution can also be integrated with various accounting and time-tracking programs. However, one drawback is that it does not include payroll tax service.

As you’ll see if you read through the rest of this guide, automatic payroll tax service is a common feature for payroll software companies. That said, most low-cost options do not include this service. If you want Patriot to do your payroll taxes on your behalf, you can upgrade to its $30/month plan, which is still cheaper than most other companies that include this service with its payroll software.

Throw in the fact that Patriot gets strong feedback from its customers, and you’ve got a laundry list of advantages compared to most payroll software providers. Especially if you operate a very small company with a handful of employees that doesn’t need a ton of complicated bells and whistles in its payroll services, it’s hard to argue with Patriot’s super-low price point.

Workful: $25/month + $5/employee (Best for Hourly Contracts)

Pros:

• Geolocational time-tracking tool included
• Employee expense tracking
• Document storage
• Payroll tax service

Cons:

• Not much experience compared to legacy companies
• Only integrates with QuickBooks

Workful hasn’t been around for long but we’re more than impressed with what it has to offer. We are not aware of any other companies that offer anywhere close to this level of features at this price point. The geolocational time-tracking tool is a godsend for companies that have hourly remote employees or contractors, and it’s a rare find in a package this affordable.

If that wasn’t enough, Workful also now includes full payroll tax service for both federal and state filings, a feature it just recently added. These are both features you’ll basically never see in software priced this affordably, and we aren’t aware of any competitors in this price range offering both.

The main drawback of Workful is that it’s a relatively new company without much of a track record. This is probably a contributing factor to our other “Con” for Workful: the lack of integration options. If that’s not a problem for you, we’re amazed by all the features they include for just 25 bucks.

Square: $35/month + $5/employee (Best for Contractors & Existing Square Software Users)

Pros:

• No monthly subscription fees to pay contractors
• Seamless integrations with other Square products
• Free seasonal inactivity plans for seasonal businesses
• Strong customer feedback

Cons:

• Some advanced features require purchase of other Square products

Square has a number of software solutions for various aspects of small business operations, including payroll. Square’s $35/month fee is a tier higher than the other companies we’ve discussed thus far, but Square will waive this fee entirely for companies with no employees that only pay contractors. That’s right, you can do payroll for all of your contractors for just $5 per contractor per month!

Even for businesses with employees, Square has a lot to offer, including free account setup assistance and full-service payroll tax service included. For businesses that are only open seasonally, Square offers free seasonal inactivity plans, providing significant annual savings over most competitors.

While Square Payroll obviously integrates very well with other Square products, some advanced features included with other payroll software solutions require the purchase of additional Square programs. For instance, you need the Square Point-of-Sale app on your smartphone to use Square Payroll’s time-tracking feature.

Still, especially if you already use other Square software in your business operations, Square Payroll is an excellent option. And, if you prioritize customer feedback, you’ll appreciate how Square Payroll maintains very high average rating scores amidst its hundreds of online customer reviews.

OnPay: $36/month + $4/employee (Best for Free HR Software)

Pros:

• Handles complex requirements seamlessly
• Includes HR software
• Industry-specific tools
• Solid customer reviews

Cons:

• No automatic payroll

OnPay has some intriguing aspects, starting with the free HR software that comes bundled with its payroll program, allowing you to automate your team management with features like custom workflows, document audits, and much more. Most competitors make you pay extra for features like this, but not OnPay.

OnPay Payroll is packed with other features too, including unlimited payroll runs, automated state and federal tax filings, plenty of accounting and time-tracking integrations, account setup services, employee benefits management, and more. OnPay also has some industry-specific tools included, which can make life much easier for entrepreneurs in specialty fields.

The only real drawback of OnPay is that its payroll services are not automated, meaning you’ll need to handle each payroll run manually. For many people, this is no big deal, but for others, it can be a non-starter.

That said, OnPay receives tremendous customer feedback, with very high scores and more than 600 reviews. Clearly, its customers appreciate what this company has to offer.

Paychex Flex: $39/month + $5/employee (Best for Record-Keeping)

Pros:

• 160+ custom reports available
• Custom data fields
• 24/7 support

Cons:

• Additional fees for account setup and tax filings

At this point in the guide, your monthly fees are climbing close to $40 per month, plus your employee fees. However, Paychex Flex has two unique features that we think make them well worth the money for businesses that need these services. First and foremost, Paychex Flex allows you to create more than 160 custom payroll reports that can give you insight into your company’s taxation, staffing, turnover, pay scales, and more.

If that’s not impressive enough to move the needle, how about the fact that Paychex Flex includes support for custom data fields? This feature allows you to enter detailed employee info into your payroll software, keeping track of things like employee birthdays, company car license plates, and just about anything else you can think of.

Paychex Flex also provides 24/7 access to its customer support network, which lower-priced options typically don’t offer. You can also get automatic payroll tax filings and accounting and time-tracking integrations. However, one downside of Paychex Flex is the fact that you’ll need to pay additional fees for account setup and end-of-year tax documents, features many other competitors offer for no extra charge.

Gusto: $39/month + $6/employee (Best for Growing Businesses)

Pros:

• Tiered service for expanding businesses
• Direct deposit functionality included
• Full-service automated payroll

Cons:

• Time-tracking app costs extra
• Pricing is high in general

Gusto is an outstanding option for companies with aggressive growth plans, as this payroll service can easily handle the evolving needs of your expanding business. Gusto’s tiered payroll software service allows you to start with its baseline Core plan and graduate to its advanced Complete option (for an additional $6/employee) if you end up needing its advanced services.

Gusto provides direct deposit support for all of its payroll customers, but it takes about four days for Core subscribers or one day for Complete subscribers. It also provides automated payroll with unlimited runs and the automatic tracking of federal and state taxes as well.

However, we’ve already hinted at the one significant negative of Gusto, which is the fact that some features that competitors sometimes include are only available if you upgrade to Gusto Complete. For instance, Gusto’s time-tracking app is not available in the Core package and requires an upgrade to Complete, which costs an additional $6 per person per month.

QuickBooks Payroll: $45/month + $4/employee (Best for Direct Deposits and Existing QuickBooks Accounting Users)

Pros:

• Next-day direct deposit
• Employee benefit functionality
• Incredibly easy to use
• Syncs seamlessly with QuickBooks accounting software
• Strong customer reviews

Cons:

• Expensive
• Not all features included in base package

If you’re already a QuickBooks user, QuickBooks Payroll will have the easiest setup and operations available for payroll software solutions. Additionally, all QuickBooks Payroll plans include next-day or same-day direct deposits, making this the best option for businesses that make frequent direct deposits to employees or contractors.

QuickBooks Payroll also offers automated payroll and state/federal taxes. QuickBooks’ base payroll plan includes integrations for 401(k) plans and health insurance as well. On top of that, QuickBooks Payroll is arguably the easiest-to-use payroll software product we’ve ever tried, as every step of the process is as seamless as possible.

The big drawback of QuickBooks Payroll is pricing. Its base plan is already the most expensive option in this guide, and you’ll need to upgrade to QuickBooks’ $75/month (plus $8/employee) plan to access time-tracking, HR support, workers’ comp administration, and more.

However, most of QuickBooks Payroll’s 850 customer reviews are positive, indicating that most customers do feel like they get their money’s worth.

In Conclusion

As you can see, there are many different payroll software solutions available at varying price points. Depending on the unique needs and circumstances of your business, you may prefer one or more of these options. In our opinion, all seven of these companies are great choices, so it all depends on your budget and requirements.

We hope this article helped you identify which payroll software product is the best fit for your business, and we wish you the best of luck in the future!