Most businesses out there may say you need advanced and expensive payroll software to handle your company’s needs. Well, if you’re looking for free payroll software or best small business payroll software , I beg to differ. I’ll even show you the exact features that make these Software For Small Business Payroll good for your business!
Payroll Software is the modern solution to paying your employee’s wages and filing your payroll taxes. While the process used to require hours of a business owner’s time or hiring HR or accounting staff to manage a payroll calendar, payroll software offers an efficient means of automating much of the payroll process.
Instead of manually calculating payroll, tracking your employee’s hours, writing checks, and deducting taxes, payroll software can automatically process your company’s payroll using integrated time and attendance software to sync your staff’s hours. And the American Payroll Association states that “organizations using a solution that has both timekeeping and payroll capabilities were 44% more likely to have a payroll error rate at 2% or less.” Therefore, payroll software offers small businesses a more efficient way to manage their payroll process, cutting back on manual effort and giving business owners more time to invest in running their business.
Intuit QuickBooks
Intuit QuickBooks offers three tiers of payroll software. The Core plan offers a great deal of value for small business owners. It will help you automate your payroll and federal and state taxes for $45, plus $4 per employee per month. You can also add 401(k) retirement plans and health benefits for your employees to the Core plan. If you want HR support and workers compensation administration, you will need to go with one of QuickBooks’s higher-tier plans, known as Premium or Elite. However, the higher-tier plans are more expensive and may be out of the standard small business’s budget.
A key difference between Intuit QuickBooks and the rest of the payroll providers in our ratings is that all of its plans provide quick direct deposit. While the average direct deposit in our ratings takes four days after payroll processing, with some companies offering faster deposits at higher-tier plans, QuickBooks Core has next-day direct deposit, and Premium and Elite provide same-day deposits. This can make all the difference to your employees because the American Payroll Association reports that “49% of U.S. workers will leave a job after experiencing just two problems with their paychecks,” including late payments.
Intuit QuickBooks is also the ideal choice for accountants. It provides its Elite payroll plan for free to accounting firms using QuickBooks Online Accountant. The construction industry can also benefit from QuickBooks. Its payroll services are used by 30,000 construction small businesses to help manage the tax laws surrounding their industry.
Square
Another payroll software with simple pricing, you get access to everything Square offers for $29, plus $5 per employee per month. And if your business only needs to pay contractors, Square waves the monthly fee of $29 and will only charge you $5 per payee per month. Square is ideal for small businesses that are already using one of Square’s other business products, such as its point-of-sales (POS) system. The payroll software integrates with Square’s POS and the Square Team app to help you manage your business. It will sync all of your business’s data together, including your employees’ hours and your company’s sales data. And payroll can be run from anywhere using the Square Payroll App from your cell phone.
However, you don’t have to use other Square products to make Square payroll software a good choice for you. It is compatible with third-party software, such as QuickBooks Online, and it has free seasonal inactivity, which will benefit small businesses, like pop-up shops, that only run certain months of the year.
Patriot
It offers the most affordable plan in our payroll software ratings, starting at just $10, plus $4 per payee per month for its Self-Service plan. Small business owners may be attracted to Patriot by the price alone, but even at such a low cost, Patriot offers its users comparable features to most other payroll providers. Patriot will set up your account for you and allow you to process unlimited payroll runs, at any frequency, across multiple office locations. You can integrate payroll with Patriot’s accounting software or QuickBooks, and use Patriot Time and Attendance or TSheets to track your employees’ hours. And Patriot offers an add-on HR service for $6, plus $2 per employee per month.
However, Patriot’s Self-Service plan does not cover your payroll taxes. If you want to automate your local, state, and federal taxes, you will need to get Patriot’s Full Service plan for $30, plus $4 per payee per month.
OnPay
It offers straightforward pricing that will cost your small business $36, plus $4 per person per month. That fee gets you access to all of OnPay’s features, including unlimited payroll runs, state and federal tax filings, and accounting and time tracking software integrations. OnPay’s customer service will set up your account for you, including adding in your employees’ information and helping you integrate any compatible business software. The payroll software comes with OnPay’s human resources (HR) software that gives you access to tools for onboarding, tracking paid time off (PTO), document storage, and HR auditing. Your company will also have the ability to add and manage employee benefits.
OnPay is also ready to help small businesses in special situations, such as restaurants with minimum wage tip makeup, agricultural workers that need to file Form 943, workers on H-2A visas, and nonprofits and churches that are exempt from federal unemployment taxes (FUTA).
Gusto
- Starting at $39.00/mo. + $6.00/payee/mo.
- Automatic payroll tax administration
- Affordable insurance options (in-house brokers)
- Two-day direct deposit
The heartily named Gusto is our favorite payroll software for small businesses. Its beautifully designed, full-service payroll system includes plenty of payroll and HR features, including these:
- Automatic local, state, and federal payroll tax filing
- Automatic end-of-year tax-form filing, including W-2s and 1099s
- Automatic state new-hire form filing
- Health benefits administration and workers compensation administration
- Multiple employee benefit options, including HSAs, FSAs, commuter benefits, and college savings plans
- Employee self-service portal for pay stub, direct deposit, and W-2 access
Even better, Gusto includes these features for free when many payroll providers charge extra. For instance, Gusto’s in-house insurance brokers ensure that if you sign up for employee medical insurance and workers compensation insurance through Gusto, you’ll pay the premium only.
In contrast, ADP, which outsources its insurance integrations, charges an extra fee on top of the premium. Ditto Paychex, which does have an in-house insurance team but still charges extra for insurance add-ons. ADP and Paychex also charge extra for end-of-year tax-form filings. Gusto doesn’t.
Heads-up: Gusto’s Contractor plan
Do you hire contractors on an individual basis instead of working with a full-time team of employees? Gusto’s new Contractor plan has no monthly base cost. You pay only $6 per month per payee.
However, in the last few months, Gusto’s customer service has taken a few hits: for instance, on the review site Trustpilot, Gusto’s rating dropped from nearly four to just 2.4 (yikes!) out of 5 from more than 1.2K reviews.1 In particular, users call out slow response times and payroll errors. Thanks to its expansive employee benefits and built-in free tax filing, Gusto’s still our top payroll solution, but we did lower its star rating to account for its lowering user reviews.
Additionally, while Gusto has more employee add-ons than many other online payroll systems, it’s not a total HR management solution. Our Gusto HR review can tell you more, but if you need more than the most basic HR, you’ll want to look elsewhere—like at Paychex.
Paychex
- Starting at $39.00/mo. + $5.00/payee/mo.
- Automatic payroll tax administration (additional fee may apply)
- Workers compensation and health insurance add-ons (additional fee applies)
- Direct deposit, check, and debit card payment options
Does your business need thorough HR assistance without full-on HR outsourcing? Paychex Flex combines cloud-based payroll management and human resources software for small and midsize businesses that want thorough, affordable HR management.
All Paychex payroll programs include new-hire state reporting, payroll tax filing, and an employee financial wellness program. And with three customizable packages, Paychex is one of the most scalable payroll options on our list. Growing businesses won’t have to look elsewhere for plans that support additional employees—growth is built into Paychex’s model.
Paychex’s payroll app for employers
If you frequently run payroll on the go, Paychex might be the best small-business payroll software for you. Only a few payroll providers offer employer-facing mobile payroll apps. Of the five or so that do, Paychex’s is easily the best: the Paychex Flex app has 4.8 stars (out of five) on Apple’s App Store and 4.4 on Google Play.2,3
Even though Paychex’s cheapest plan has a lower per-employee fee than Gusto, Paychex’s add-on fees can dramatically increase your monthly payroll costs. Unlike Gusto, OnPay, and QuickBooks Payroll, Paychex may charge additional fees for payroll tax administration, time and attendance software integration, accounting software integration, and workers comp and employee benefits administration. With all the extra fees, Paychex is better suited to midsize businesses that care more about built-in scalability than cost.
Conclusion
Payroll is one of the most important tasks small business owners have to do. If you are running a small business you are not only selling products or services but also paying employees for their time and effort. All this requires reliable payroll software. So, should you hire someone to help with your payroll or just rely on the best free payroll app that does it all? The choice is yours.