What Is the Best Payroll Service for Small Business “How do I hire the right payroll service?” – This is one of the most important questions! There are many innovative payroll companies in the market, each claiming to offer an outstanding enterprise-class solution. It would be great if you can find a payroll company that will meet all your requirements.
Small businesses are responsible for around 54% of the total payroll in the United States. It is no wonder, then, that it is estimated that more than $184 billion is lost in taxes each year because of employers not meeting their payroll tax responsibilities. This figure makes it important for all employees to find out what the best payroll service is for small business owners.
What to look for in payroll services
Before looking for payroll processing services, you first must determine what features are the most important to you. Here are a few things to consider:
1. Features offered
While most payroll providers offer similar services, in some cases those services may be included in the base price, while in other cases, they are available at an additional cost.
HR features can be beneficial to a smaller business with no dedicated HR staff person, but are HR features included in the pricing, or do you have to pay extra for them?
Some payroll companies offer numerous plans, with some features only found in the more expensive plans, so be sure to keep that in mind when looking for a payroll service provider.
2. Ease of use
Small business owners have to wear many hats, and often don’t have the time or desire to learn a complicated software application.
Before purchasing a payroll application for your business, be sure that the product is easy to use and can be up and running in a short period of time.
3. Affordability
What can your business afford to pay? We know that affordability is subjective. While the majority of the payroll service providers included in this list come in at around the same price, some of the applications include all features, while others offer a basic plan, with the option to add additional features at an additional cost.
Another thing to keep in mind is that while the base fee may be higher in some applications, it can actually cost you less if all of the features are included in that base price.
4. Access to benefit management
If you offer benefits to your employees, you’ll also want to have access to benefit management features. These can include standard benefit management, as well as access to affordable health, life, and disability insurance plans.
In addition, if you currently offer benefits such as group term life insurance over $50,000, personal use of a vehicle, dependent care assistance, or a gym membership, you may need to add the value of these benefits as imputed income. Make sure your payroll service offers that option.
Our 10 picks for the best payroll services
Small business owners have a lot of choices when it comes to finding a payroll service provider. While the majority of the payroll applications reviewed offer online payroll services, there are a few that offer an on-premise solution, and there’s even one free option. Here are our top 10 choices.
1. OnPay
OnPay is The Blueprint’s number one choice for payroll services for small businesses with good reason. Though designed for small businesses, OnPay can scale up nicely to suit mid-size businesses as well.
Featuring easy system navigation, OnPay offers industry-specific features for restaurants and other businesses that need to account for employee tips.
OnPay offers easy employee setup. Source: OnPay software.
OnPay’s plan also includes unlimited payroll runs, complete mobile accessibility from any device, direct deposit, and multistate payroll capability, as well as employee onboarding and self-service capability.
No separate mobile app is needed, as the application is designed to work on any platform and the application easily pays both employees and contractors, producing both W-2s and 1099s at year-end.
In addition to complete payroll processing, OnPay offers comprehensive HR resources including employee offer letters, PTO approvals, compliance tools, and a variety of HR templates that can be used in various situations.
OnPay offers excellent integration options with a variety of third-party accounting and timesheet/timekeeping applications, and their support team is trained by the American Payroll Association.
OnPay offers a single plan, with pricing for the plan currently running $36/month, plus a $4 per employee fee. All features, including HR and complete support options, are included in the price.
Read The Blueprint’s full OnPay review
Check out OnPay and see for yourself why it’s the highest rated payroll tool on The Blueprint.Visit OnPay
2. QuickBooks Online Payroll
Designed to integrate with QuickBooks Online Accounting, QuickBooks Online Payroll can also be used as a stand-alone payroll software application. QuickBooks Online Payroll can be used for up to 50 employees, but because of varying pricing levels, is most affordable for businesses with 15 employees or less.
QuickBooks Payroll includes easy onboarding for all new employees. Source: QuickBooks Online Payroll software.
QuickBooks Online Payroll offers an easy onboarding process, so you can be up and running quickly. The application offers unlimited payroll runs, direct deposit capability, and tax reporting and remittance in all of its plans.
There is also an employee portal available so your employees can access pay stubs and tax forms. All plans include a mobile app for both iOS and Android devices.
QuickBooks Online Payroll does offer HR features, but they are only available in the Premium and Elite plans. Both plans also include time tracking capability.
QuickBooks Online Payroll starts at $22.50/month, with the Premium plan running $37.50/month, and Elite $62.50/month. All pricing reflects an initial 50% discount for the first three months, with a $4 per employee fee added to the base price.
Read The Blueprint’s full QuickBooks Online Payroll review
3. Patriot Payroll
Patriot Payroll may not be as well known as some of the other payroll applications highlighted here, but they offer many of the same features. Patriot Payroll is designed for small businesses and currently offers two plans, both offering free direct deposit, an employee portal, and free payroll setup.
Keep in mind that the Basic plan does not include tax filing and remittance.
Patriot Payroll makes it easy to create time off accrual rules for employees. Source: Patriot Payroll software.
Patriot Payroll offers easy, intuitive navigation, and the cost includes complete program setup. The software works on any device, so no mobile app is needed. The application also includes an excellent accrual rule option, for easy tracking of employee PTO.
Optional Time and Attendance and HR modules are also available, both integrating with the payroll application.
While Patriot Payroll doesn’t include a lot of extras, small businesses that are looking for an easy way to pay employees and payroll taxes will appreciate its simplicity.
Patriot Payroll offers two plans, Basic which is $10/month and Full-Service, which is $30/month, with a $4 per employee fee added to the base price. The add-on Time and Attendance module is $5/month, with the Human Resources module running $4/month, with each adding an additional $1 per employee fee.
Read The Blueprint’s full Patriot Payroll review
4. Gusto Payroll
Gusto is designed for small businesses, and is particularly well suited to those in the hospitality industry, offering tools and resources that make tracking varying wage levels and tip amounts a relatively simple task. Gusto also assists new users with the initial payroll setup process, getting you up and running quickly.
Setting up employee benefits is easy in Gusto. Source: Gusto Payroll software.
Offering easy system navigation, Gusto includes new-hire reporting, flexible payroll schedules, unlimited payroll runs, contractor payments, and multistate payroll capability. Gusto can be accessed from any device, so no mobile app is necessary.
The application also includes employee onboarding, complete tax reporting and remittance. Gusto also offers HR resources, but only in their most expensive plan.
The AutoPilot feature is a great option for businesses that pay a high number of salaried employees, and Gusto offers good integration options with a variety of third-party applications.
Gusto offers four plans: Basic, which is designed for one or two employees; Core, best for smaller businesses; Complete, which is good for growing businesses; and Concierge, which is best for larger businesses with HR needs.
Gusto’s Basic plan has a base price of $19/month, with a $6-per-employee fee; the Core plan’s base price is $39/month with a $6-per-employee fee; Complete is $39/month, plus a $12-per-employee fee; and Concierge has a hefty price tag of $149/month, plus a $12-per-employee fee.
Read The Blueprint’s full Gusto Payroll review
5. SurePayroll
SurePayroll is designed for small business owners and includes a special version for those paying domestic staff. Best for small businesses with 10 employees or less, SurePayroll has worked to automate the entire payroll process, a major bonus for already overworked business owners.
SurePayroll includes a comprehensive payroll preview report. Source: SurePayroll software.
SurePayroll offers direct deposit, new-employee reporting, and time and attendance tracking. The application also includes complete tax reporting and remittance, with a mobile app available for both iOS and Android devices.
An employee self-service option is also available, and SurePayroll also integrates with a wide variety of third-party applications.
SurePayroll offers an easily navigated payroll dashboard that provides access to all payroll features. The application has simplified the payroll entry process, minimizing the amount of data entry needed. An AutoPayroll option is also available for salaried employees.
SurePayroll offers two plans: Self-Service, which does not include tax reporting and filing, and Full Service, which includes a two-day payroll processing timeframe, along with access to HR resources and compliance posters.
The Self-Service plan runs $19.99/month plus a $4 per employee fee, while the Full-Service plan is $29.99/month, plus a $5 per employee fee.
Read The Blueprint’s full SurePayroll review
What to look for in payroll services
Before looking for payroll processing services, you first must determine what features are the most important to you. Here are a few things to consider:
1. Features offered
While most payroll providers offer similar services, in some cases those services may be included in the base price, while in other cases, they are available at an additional cost.
HR features can be beneficial to a smaller business with no dedicated HR staff person, but are HR features included in the pricing, or do you have to pay extra for them?
Some payroll companies offer numerous plans, with some features only found in the more expensive plans, so be sure to keep that in mind when looking for a payroll service provider.
2. Ease of use
Small business owners have to wear many hats, and often don’t have the time or desire to learn a complicated software application.
Before purchasing a payroll application for your business, be sure that the product is easy to use and can be up and running in a short period of time.
3. Affordability
What can your business afford to pay? We know that affordability is subjective. While the majority of the payroll service providers included in this list come in at around the same price, some of the applications include all features, while others offer a basic plan, with the option to add additional features at an additional cost.
Another thing to keep in mind is that while the base fee may be higher in some applications, it can actually cost you less if all of the features are included in that base price.
4. Access to benefit management
If you offer benefits to your employees, you’ll also want to have access to benefit management features. These can include standard benefit management, as well as access to affordable health, life, and disability insurance plans.
In addition, if you currently offer benefits such as group term life insurance over $50,000, personal use of a vehicle, dependent care assistance, or a gym membership, you may need to add the value of these benefits as imputed income. Make sure your payroll service offers that option.
Our 10 picks for the best payroll services
Small business owners have a lot of choices when it comes to finding a payroll service provider. While the majority of the payroll applications reviewed offer online payroll services, there are a few that offer an on-premise solution, and there’s even one free option. Here are our top 10 choices.
1. OnPay
OnPay is The Blueprint’s number one choice for payroll services for small businesses with good reason. Though designed for small businesses, OnPay can scale up nicely to suit mid-size businesses as well.
Featuring easy system navigation, OnPay offers industry-specific features for restaurants and other businesses that need to account for employee tips.
OnPay offers easy employee setup. Source: OnPay software.
OnPay’s plan also includes unlimited payroll runs, complete mobile accessibility from any device, direct deposit, and multistate payroll capability, as well as employee onboarding and self-service capability.
No separate mobile app is needed, as the application is designed to work on any platform and the application easily pays both employees and contractors, producing both W-2s and 1099s at year-end.
In addition to complete payroll processing, OnPay offers comprehensive HR resources including employee offer letters, PTO approvals, compliance tools, and a variety of HR templates that can be used in various situations.
OnPay offers excellent integration options with a variety of third-party accounting and timesheet/timekeeping applications, and their support team is trained by the American Payroll Association.
OnPay offers a single plan, with pricing for the plan currently running $36/month, plus a $4 per employee fee. All features, including HR and complete support options, are included in the price.
Read The Blueprint’s full OnPay review
Check out OnPay and see for yourself why it’s the highest rated payroll tool on The Blueprint.Visit OnPay
2. QuickBooks Online Payroll
Designed to integrate with QuickBooks Online Accounting, QuickBooks Online Payroll can also be used as a stand-alone payroll software application. QuickBooks Online Payroll can be used for up to 50 employees, but because of varying pricing levels, is most affordable for businesses with 15 employees or less.
QuickBooks Payroll includes easy onboarding for all new employees. Source: QuickBooks Online Payroll software.
QuickBooks Online Payroll offers an easy onboarding process, so you can be up and running quickly. The application offers unlimited payroll runs, direct deposit capability, and tax reporting and remittance in all of its plans.
There is also an employee portal available so your employees can access pay stubs and tax forms. All plans include a mobile app for both iOS and Android devices.
QuickBooks Online Payroll does offer HR features, but they are only available in the Premium and Elite plans. Both plans also include time tracking capability.
QuickBooks Online Payroll starts at $22.50/month, with the Premium plan running $37.50/month, and Elite $62.50/month. All pricing reflects an initial 50% discount for the first three months, with a $4 per employee fee added to the base price.
Read The Blueprint’s full QuickBooks Online Payroll review
3. Patriot Payroll
Patriot Payroll may not be as well known as some of the other payroll applications highlighted here, but they offer many of the same features. Patriot Payroll is designed for small businesses and currently offers two plans, both offering free direct deposit, an employee portal, and free payroll setup.
Keep in mind that the Basic plan does not include tax filing and remittance.
Patriot Payroll makes it easy to create time off accrual rules for employees. Source: Patriot Payroll software.
Patriot Payroll offers easy, intuitive navigation, and the cost includes complete program setup. The software works on any device, so no mobile app is needed. The application also includes an excellent accrual rule option, for easy tracking of employee PTO.
Optional Time and Attendance and HR modules are also available, both integrating with the payroll application.
While Patriot Payroll doesn’t include a lot of extras, small businesses that are looking for an easy way to pay employees and payroll taxes will appreciate its simplicity.
Patriot Payroll offers two plans, Basic which is $10/month and Full-Service, which is $30/month, with a $4 per employee fee added to the base price. The add-on Time and Attendance module is $5/month, with the Human Resources module running $4/month, with each adding an additional $1 per employee fee.
Read The Blueprint’s full Patriot Payroll review
4. Gusto Payroll
Gusto is designed for small businesses, and is particularly well suited to those in the hospitality industry, offering tools and resources that make tracking varying wage levels and tip amounts a relatively simple task. Gusto also assists new users with the initial payroll setup process, getting you up and running quickly.
Setting up employee benefits is easy in Gusto. Source: Gusto Payroll software.
Offering easy system navigation, Gusto includes new-hire reporting, flexible payroll schedules, unlimited payroll runs, contractor payments, and multistate payroll capability. Gusto can be accessed from any device, so no mobile app is necessary.
The application also includes employee onboarding, complete tax reporting and remittance. Gusto also offers HR resources, but only in their most expensive plan.
The AutoPilot feature is a great option for businesses that pay a high number of salaried employees, and Gusto offers good integration options with a variety of third-party applications.
Gusto offers four plans: Basic, which is designed for one or two employees; Core, best for smaller businesses; Complete, which is good for growing businesses; and Concierge, which is best for larger businesses with HR needs.
Gusto’s Basic plan has a base price of $19/month, with a $6-per-employee fee; the Core plan’s base price is $39/month with a $6-per-employee fee; Complete is $39/month, plus a $12-per-employee fee; and Concierge has a hefty price tag of $149/month, plus a $12-per-employee fee.
Read The Blueprint’s full Gusto Payroll review
5. SurePayroll
SurePayroll is designed for small business owners and includes a special version for those paying domestic staff. Best for small businesses with 10 employees or less, SurePayroll has worked to automate the entire payroll process, a major bonus for already overworked business owners.
SurePayroll includes a comprehensive payroll preview report. Source: SurePayroll software.
SurePayroll offers direct deposit, new-employee reporting, and time and attendance tracking. The application also includes complete tax reporting and remittance, with a mobile app available for both iOS and Android devices.
An employee self-service option is also available, and SurePayroll also integrates with a wide variety of third-party applications.
SurePayroll offers an easily navigated payroll dashboard that provides access to all payroll features. The application has simplified the payroll entry process, minimizing the amount of data entry needed. An AutoPayroll option is also available for salaried employees.
SurePayroll offers two plans: Self-Service, which does not include tax reporting and filing, and Full Service, which includes a two-day payroll processing timeframe, along with access to HR resources and compliance posters.
The Self-Service plan runs $19.99/month plus a $4 per employee fee, while the Full-Service plan is $29.99/month, plus a $5 per employee fee.
Read The Blueprint’s full SurePayroll review
ADP Run
ADP is the most experienced payroll service option on our list. They service businesses of all sizes so they are equipped to handle a small business or they can handle hundreds of employees without a problem. That’s why we chose ADP Run as our best payroll service for growing businesses that plan to be greater than 100 employees.
Here’s a more detailed breakdown of ADP’s payroll service:
- Pricing: Unique pricing for all businesses that is undisclosed.
- Ease of Use: Moderately easy to use but it can be difficult for small businesses who are unfamiliar with payroll software
- Tax Services: Handles all W2 and 1099 filings as well as employer tax filings
- Year-End Fees: All year-end filings are included in the price, regardless of what package you select
- Accounting Integrations: QuickBooks, Xero, and most other accounting software
ADP isn’t known for great customer service, but they still have mostly good reviews online. Their customer service is available 24/7. Overall, their service is widely available but it’s subpar in terms of quality compared to other options on the list.
BEST FOR SOFTWARE INTEGRATIONSOnPay
OnPay is a solid payroll service that offers integrations for not only most accounting software options but also with most time tracking software. OnPay’s API makes it easy to integrate even if they don’t currently offer a direct integration. That’s why we chose OnPay as the best option if you’re looking for integration options. OnPay is also very quick to process payroll, and you can run the entire process easily right on your mobile device. They offer a flat pricing structure that’s affordable and easy to understand.
Here’s a more detailed breakdown of OnPay’s payroll service:
- Pricing: $36 + $4 per employee per month
- Ease of Use: Very Easy
- Tax Services: Handles all W2 and 1099 filings, annual employer tax filings
- Year-End Fees: All filings are included in the flat fee pricing
- Accounting Integrations: QuickBooks, Xero, and most other major accounting software
OnPay has strong reviews for its customer support. They offer both phone and email support, available Monday to Friday from 9:00 a.m. to 8:00 pm Eastern. If customer support is one of the most important things to you, then this is a great option.
BEST FOR PAYING HOUSEHOLD WORKERSSurePayroll
SurePayroll is a good option if you’re looking for something different than what we’ve already discussed. In fact, if you’re in a very niche industry and find it difficult to find a good partner, then this might be the best bet for you. They work great with every business type from retail to churches. That’s why we chose it as the best payroll service if you’re looking to pay the workers who work for you at your home.
Here’s a more detailed breakdown of SurePayroll’s payroll service:
- Pricing: $19.99 to $49.99 + $4 to $10 per month per employee or independent contractor
- Ease of Use: Easy—it’s not the easiest option on the list, but it’s intuitive enough to help pretty much any business
- Tax Services: Can handle W2, 1099, and employer filings, but it’s only included in their Full-Service plan
- Year-End Fees: The Full-Service plan includes filing of federal taxes. Additional fees may apply to state filings
- Accounting Integrations: Zoho Books, Xero, and other accounting software
SurePayroll offers a Full-Service plan or a No Tax Filing plan, both include a variety of payroll features. Their customer support has a good, not great, reputation across the internet. They do offer six days of support, though, with their hours being Monday to Friday from 7:00 a.m. to 8:00 p.m. Central Time, and Saturday from 9:00 a.m. to 1:00 p.m.
FAQs
What Are Payroll Services?
Payroll services is a term that includes the software and/or the outsourced parties used to process payroll for businesses. Typically, a payroll service will provide not only a way for you to process basic payroll, but you’ll get lots of extra features. These include a way to pay employees via direct deposit, integrations or built-in methods to record time, tax calculations and processing, and a way for you to issue year-end documents like W2s and 1099 forms to your employees.
Most small businesses will be satisfied with an all-in-one software solution that is affordable and can do most of the heavy lifting for you, especially if you don’t have an internal team of experts to process payroll on your behalf. This simplifies payroll without breaking the bank. There are also outsourced services, such as a personal employer organization (PEO), that will take care of all payroll activities but unless you have a significant amount of employees, they can be expensive or difficult to work with.
There are numerous things to look for when you are trying to find the right payroll service for your business. “Among the top considerations when evaluating payroll service providers are user-friendly software that meets your technical requirements, a track record of dependable service, and fair and transparent pricing,” says Leigh-Ann Mosley, Director at Inova Payroll. “A user should also look at the long-game when considering a payroll service provider. Will the service easily expand if I add 10 or 50 employees? Are there fee increases each year?”
How Do Payroll Services Work?
A payroll service, or payroll software, is used by businesses to automatically calculate and process payroll. Typically you’ll either set up an automatic connection with whatever system you use to collect your employee’s time or you’ll manually enter work time each week into your payroll service.
Based on the information you’ve entered about each employee, your software will calculate how much tax to withhold and how much to pay your employees. If your employees have direct deposit, then your payroll service will initiate a transfer from your bank account to theirs.
At the end of the year, your payroll service will easily run the 1099 and W2 forms of your workers and help you either print or provide secure access to these documents for your employees. This can save you countless hours of trying to create and send these to your employees by the deadline. Plus, using software that you’ve used to pay the employees all year ensures that the numbers align with the money that has been deposited into their bank accounts.
How Much Do Payroll Services Cost?
Payroll services typically require a base cost of $20 to $100 per month plus an additional cost per employee or independent contractor that ranges from $4 to $10. Some services might have a per-pay or per-check fee, but if you’re planning on pushing direct deposit for employees then you can rely on the costs above, which typically will include weekly pay periods, if desired.
Are Payroll Services Worth the Cost?
If you have even one employee then these payroll services are typically worth the cost just for the amount of time and risk they will save you and your business. If you have a good handle on employee laws, taxes, and accounting for your business, then you could do this yourself, but the potential cost and liability of missing deadlines or paying people incorrectly could end up costing you a lot more than the price of a simple payroll service or software.
Other types of software will offer payroll services as an add-on to a program you’re already purchasing, but we still recommend getting your own service provider. The add-ons don’t typically have all of the features that make the best payroll services so great, and they can cost about the same or more than the ones on this list.
How We Chose the Best Payroll Services for Small Business
We researched nearly two dozen of the best payroll services based first on the combination of features and pricing. At a minimum all payroll services needed to offer a way to automatically track time, calculate payroll and taxes, direct deposit your employee’s pay, and provide end-of-year tax documents. Beyond that, we also considered ease of use, additional features, and customer service.
Conclusion
A lot of entrepreneurs and business owners do not like dealing with payroll services because they find the process too complicated and stressful. However, if you know your liability and obligations, this is not a task you should be afraid to take on. To help you through this process, there are numerous companies such as Paychex and ADP, which offer payroll services.