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As a small business owner, having a system that helps you manage and administrate your employee’s payroll is a necessity. It saves you time you would otherwise spend on manually processing your payroll –time you simply cannot afford to spare.
Payroll services also save you fines you could incur as a result of incorrect payroll fillings. According to an Internal Revenue Service (IRS) report, 40% of small to medium-sized businesses in the United States pay payroll penalties each year. This can be avoided with payroll software. Not just any payroll system, but one suited to the delicate needs of a small business. That is why, in this article, we set out to review some of the best payroll providers on the market for small businesses.
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Hours Researched
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2
Experts Consulted
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19
Vendors Reviewed
Our criteria: How we chose the best vendors
We take our research seriously and want to make sure we are presenting our readers with the very best solutions in a given software category. Here's how we select vendors to be in our buyer guides:
- Product: We want to have a deep understanding of a vendor's product before recommending it. This usually means getting a demo by a senior executive (their CEO, head of product, etc), and/or using the product ourselves to make sure it has a solid UI, intuitive workflows, and the features to make it a best in class offering.
- User feedback: We do our best to understand what users say when they experience this product. User input allows us to accomplish a more thorough due diligence of products, put new vendors on our radar, and generally make sure we are presenting the right products to our readers.
- Financial metrics: We are very much finance nerds and so use a product's retention rates, growth, profitability, and scale to understand whether or not it is truly best in class.
- Best for a use case: Sometimes the best solution is the cheapest, the best tool for international companies, or the best for startups. We try to include a diversity of solutions so that our readers can find the tool that is best for what they need.
Here's more detail if you want to read further on how we research vendors.
In this guide you'll find
Featured in
Top Payroll Software for Small Businesses
We assessed and evaluated thousands of HRTech solutions based on the four key attributes that payroll software for small businesses should have - functionality, ease of use, value for money, and customer support. Based on our research and expert council, these are the best payroll software options available for small companies as of January 2022.
Why we love it
:
Patriot is the most affordable full-service payroll for small businesses
Patriot is the most affordable full-service payroll for small businesses
Patriot
Review:
Of all the full-service payroll software on this list, Patriot is the most affordable. It offers basic payroll and tax management with an intuitive interface that is easy to navigate.
It is designed with the small business owner in mind, providing free payroll setup and expert support from US-based professionals to make the experience a lot easier.
Patriot
Customers:
Patriot
Stats:
Patriot
Pricing:
Patriot’s basic payroll service goes for $10 per month plus $4 per employee. Their full-service payroll is tagged at $30 per month plus $4 per employee.
Patriot's basic payroll service goes for $10 per month plus $4 per employee. Their full-service payroll is tagged at $30 per month plus $4 per employee.
Best For:
Small businesses with very basic payroll needs.
Worth Checking Out:
Why we love it
:
There are flexible options and add-ons designed with small businesses in mind.
PayChex
Review:
Paychex Flex offers HR functionality, retirement packages, online payroll services, and benefits for businesses ranging from solopreneurs to SMBs. It is user-friendly and has numerous plans that cater to the needs of any company size.
Unlike Gusto, which provides health insurance in just 39 states, Paychex Flex covers all 50 states in the US.
PayChex
Customers:
PayChex
Stats:
- Paychex pays 1 in 12 US private sector employees
- Serves 700,000+ SMBs and enterprises
PayChex
Pricing:
Paychex Flex offers a variety of plans depending on your specific needs. There are three curated packages readily available on their website - Paychex Flex Essentials, Paychex Flex Select, and Paychex Flex Pro.
Their Essentials plan is available for a $39 monthly base rate plus $5 per employee per month. Select and Pro are custom plans and you would need to call to get a quote.
Best For
Small companies with basic payroll needs and solopreneurs that want HR software with payroll features.
Worth Checking Out:
Why we love it
:
This service makes it easy for businesses to hire and pay employees remotely across the globe.
Remote
Review:
As the name suggests, Remote helps employers and business owners hire and manage their workforce across the globe. The software combines benefits, tax, HR, and compliance services to give you a well-rounded solution to onboard employees from any part of the world without getting into trouble with local labor laws in respective countries.
Remote functions as an employer of records (EOR) with local entities in over 50 countries and counting. They plan to set up in 130 more countries this year.
Remote
Customers:
Remote
Stats:
Remote
Pricing:
Remote offers three pricing packages:
- Contractor Management: Free
- Employer of Record: Starts at $299
- Global Payroll: Call to get a quote
Best For
An excellent choice for remote-first companies wanting to run payroll internationally.
Worth Checking Out:
Why we love it
:
Seamlessly integrates with Square POS and other Square labor management tools.
Square
Review:
Square is known for its retail payment-processing tools such as Square reader and Square POS. In 2015, they introduced Square payroll to cater to the payroll needs of SMBs.
The platform provides basic tools for you to automatically file taxes, manage employee work hours, and run payroll. For small businesses using Square POS, this software integrates seamlessly to provide a labor-sales ecosystem.
Square
Customers:
Square
Stats:
Square
Pricing:
Square payroll gives a $35 per month flat rate plus $5 per employee. They also offer a contractors-only plan for $5 per contractor.
Best For
Square is an incredible option for retailers, especially store owners and restaurants. These small businesses will find the combination of Square POS and Square payroll useful in many ways.
Worth Checking Out:
Why we love it
:
Easily integrates with other Quickbooks products and has the fastest direct deposit.
QuickBooks
Review:
Most small businesses use Intuit Quickbooks accounting software for their lightweight bookkeeping. It is effective, simple, and affordable. The same is true for their online payroll software. Quickbooks payroll processes employee pay stubs and automatically files taxes in a simple, intuitive interface.
Quickbooks online stands out as having the fastest direct deposit amongst its competitors, processing same-day and next-day payments.
QuickBooks
Customers:
QuickBooks
Stats:
- Users save an average of 40 hours per month and find, on average, $3,000+ in tax savings per year.
- 1.4 million businesses use Quickbooks payroll
QuickBooks
Pricing:
Quickbooks pricing is as follows:
- Core Plan: $22 per month plus $4 per employee
- Premium Plan: $37.50 per month plus $8 per employee
- Elite Plan: $62.50 per month plus $10 per employee
Best For
Small businesses that are already using Quickbooks accounting.
Worth Checking Out:
Why we love it
:
It is fast, easy to use, and does not require a steep learning curve.
OnPay
Review:
Like all of the cloud-based software mentioned in this list, OnPay performs basic payroll, HR, and benefits management functions. It is the fastest among the software mentioned, saving businesses up to 15 hours a month. It is also extremely easy to use with very intuitive functions and it has a responsive chat feature operated by helpful professionals.
OnPay has curated solutions for businesses in several business niches ranging from agriculture to NGOs, franchise to healthcare, and more. It also integrates with Xero accounting software.
OnPay
Customers:
OnPay
Stats:
OnPay
Pricing:
OnPay starts at $36 per month plus an additional monthly fee of $4 per employee. Your first month is free.
Best For
OnPay is best for small business owners that have no prior background knowledge on anything payroll.
Worth Checking Out:
Why we love it
:
It’s a well-rounded system that seamlessly synchronizes payroll, benefits, and HR in one place.
Gusto
Review:
Previously known as ZenPayroll, Gusto is an all-in-one, intuitive HR platform that provides small businesses with tools ranging from hiring and onboarding, talent management, analytics and reporting, and of course, full-service payroll.
Gusto is a standout for helping small businesses save money (up to $250,000) using R&D tax credits to offset payroll tax liabilities.
Gusto
Customers:
Gusto
Stats:
- 200,000+ clients in the US, half of which are small businesses
- Helped Cortex, a healthcare company, scale from 10 employees in one state to over 500 employees in 40 states
Gusto
Pricing:
Gusto offers three payment options - core, complete, and concierge. There is also a custom option where you can cherry-pick any of the payroll, HR, benefits, and team management services that are the best fit for your business.
- Gusto Core and Complete plans run for a base fee of $39/ month plus an additional fee of $6 and $12 per employee per month.
- Gusto concierge runs for a $149/month base rate plus $12 per month per person.
Best For
Gusto is the best choice for SMBs in the US looking to scale sometime in the future.
Worth Checking Out:
Why we love it
:
Zenefits is a great option for small businesses looking for a robust, all-in-one HR, payroll, and benefits management system without breaking the bank.
- It’s one of the top names in HR tech and payroll software for American small businesses.
- Their platform is one of the best-looking and easiest to figure out among the sector.
- Zenefits can grow with you. Its pricing plans allow you to pay and tweak as you go, add certain modules when you need them, or get rid of them if you don’t.
- As oriented to small businesses as the tool is, it doesn’t give you the chance to create a custom bundle of the services and/or modules you’d like to have. For instance, Zenefits does not offer a standalone ACA module. Therefore, you will need to purchase an entire HRIS plan if you want to access that offering.
- In addition, Zenefits focuses on small to mid sized companies. If you're an enterprise organization, you may want to consider another option.
- Zenefits is also rather focused on the US market at this point. So, if your team is mostly in another country and you need more of a local know-how, it might not be the best bet for certain modules like payroll and benefits.
Zenefits
Review:
Unlike other small business payroll software in this guide, Zenefits offers a robust package by default, integrating HR, benefits, time management, compliance, and payroll in every single plan; with subtle variations depending on the extent of your needs.
Zenefits is famed for its intuitive user interface. It provides a lot of reports for SMBs to keep track of their business growth metrics.
Zenefits
Customers:
Zenefits
Stats:
Users spend 90% less time on payroll with ZenefitsOn the list of AdvisoryHQ’s top five payroll software for small business firms.
Zenefits
Pricing:
Zenefits has three plans. The Essentials plan goes for $10/month per employee, the Growth plan for $18/month per employee, and the Zen plan for $27/month per employee.
Best For
SMBs that require HR services and employee management functions together with payroll. The platform’s tips reporting is also a good feature that could be especially beneficial to those in the restaurant business.
Worth Checking Out:
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Final Advice on Buying a Small Business Payroll Solution
For small businesses, the process of choosing a payroll service provider can be cumbersome. The extreme dynamicity of small businesses requires you to choose one that fits your exact needs. We advise you to highlight your needs using these questions:
- How big is my business? Are you a solopreneur, a microbusiness with fewer than 10 employees, or maybe a small enterprise with over 100 staff?
- Who are my employees? Are your employees salaried workers or contractors? If they are salaried, do you pay an hourly wage or monthly salary?
- What is my budget? How much can you spend per employee/per month?
Answering these questions satisfactorily will streamline your payroll options. If, for example, you have employees that get paid per hour, you will likely opt for a payroll software that has time tracking to calculate and sync employee hours with payroll.
In the end, make sure to take your time and ask a lot of questions before you choose the best payroll software for your small company.
Please note that the services mentioned in this article are for small companies in the United States. If you are a global business looking to compensate your remote employees while staying compliant with international labor laws, check out our roundup of the best international payroll companies.
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