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With so many online payroll companies to choose from in 2021, finding the service that has all of the functionality your business needs can be a difficult task. To help you find the right service for your business, we examined nearly 80 payroll providers. We looked at cost, features and tools, and customer support to find the online payroll services we think are best for small businesses.
| Starting Monthly Price | # of Service Plans | Unlimited Payroll | Mobile App | |
| ADP | Custom | 4 | No | Yes |
| Paychex | $59, plus $4 per employee | 3 | Yes | Yes |
| OnPay | $36, plus $4 per employee | 1 | Yes | No |
| Gusto | $19, plus $6 per employee | 4 | Yes | No |
| Rippling | $8 per employee per month | 2 | Yes | Yes |
| Intuit | $22.50, plus $4 per employee | 3 | Yes | Yes |
| Deluxe | Custom price | 1 | Yes | Yes |
| Square | $29 per month, plus $5 monthly per person paid | 2 | No | Yes |
| Zenefits | $8 per employee per month | 3 | No | Yes |
| Paycor | $99 per month | 3 | Yes | Yes |
Paychex is a robust cloud-hosted payroll service that manages payroll processing and tax obligations, and provides a host of other HR-related survives. The Paychex Flex platform is accessible online or via the mobile app for iOS and Android devices. You can pay anyone who does work for you through Paychex, including W-2 workers, 1099 contractors and freelancers.
Paychex offers plans suitable for businesses small and large, making it a good option for businesses seeking a payroll processing partner they can scale with. Paychex offers three different service plans, and payment methods are customizable as well, including direct deposit, paper checks and prepaid debit cards.
Running payroll is a simple process with Paychex. In essence, all you have to do is enter your employees' salaries and pay rates, note how many hours they worked, and then submit your payroll for processing. Paychex takes care of the rest. It calculates each paycheck, withholding the proper amounts for payroll taxes and other benefits. It then pays your employees via direct deposit, pay card or printed check.
Paychex has three different pricing plans to choose from: Go, Flex Select and Flex Enterprise. Each of these plans include all the core payroll processing and payroll tax features we looked for in our review. Here's more about these three plans.
In addition to its payroll services, Paychex offers human resources tools and services, time and attendance systems, employee benefits, and business insurance. This is another element that makes Paychex a scalable platform. Larger organizations can also leverage Paychex to manage time and attendance, recruiting, hiring and benefits.
QuickBooks Online Payroll by Intuit provides businesses of all sizes with payroll and related tax services. As a cloud-hosted service, it doesn't require you to install or maintain any software. You can log in to the system to process payroll, review and pay payroll taxes, and view detailed labor reports, while your employees can view their paystubs, pay history and PTO accruals.
QuickBooks Online is available in three service plans – Core, Premium and Elite – which all allow small business owners to run payroll and file taxes automatically. Other services in the various plans include a workforce portal for employees, health benefits from SimplyInsured, time tracking, an HR support center and project management.
QuickBooks has multiple service plans covering payroll processing and payroll tax preparation. They include:
QuickBooks accounting software can be included with each of these plans as an add-on. Each plan includes a 30-day free trial.
QuickBooks also offers three desktop payroll plans that include different services, features and prices than the plans listed above. These include:
QuickBooks is a flexible service that can meet the needs of just about any small business looking to run payroll online. If you're interested, the company provides access to the QuickBooks accounting software as part of its payroll offering, giving you intuitive accounting and payroll software in one simple plan. By focusing on plan variety and addressing a full spectrum of small business needs, QuickBooks defines itself as a versatile small business payroll provider.
Gusto is our choice for the best online payroll software with added HR tools because of the many HR services it offers. In addition to taking care of all your payroll processing and payroll tax needs, Gusto can handle many of your HR tasks, such as managing your staff's paid time off (PTO) and administering health insurance. It also grants access to certified HR professionals who can guide you through all sorts of situations.
Gusto is available in four service plans that range from $19 to $149 per month, plus $6 to $12 per employee. The range of service plans gives you the option to use Gusto just for your payroll needs, or to upgrade plans if you want to tap into the HR resources.
To run payroll with Gusto, you can log in to the system from anywhere online, enter an employee's hours plus any PTO and any bonuses or commissions they earned, and click Submit Payroll. The employee is then paid with direct deposit or a printed check. The flexibility of payment method and the ease of running payroll makes Gusto an ideal service for small businesses.
Gusto is available in four service plans, including:
Gusto is an intuitive, easy-to-use software platform that most users can learn quickly with minimal training. Running payroll, for example, is as easy as logging in, clicking the Run Payroll tab, and filling out the fields regarding employee hours, vacation time, bonuses, commissions, etc. When the information is entered, simply click Submit Payroll. Most of the processes in Gusto are similarly straightforward.
Rippling stands out as a user-friendly online payroll software that requires little to no training to quickly become proficient with the system. The company claims that Rippling allows you to "run payroll in 90 seconds," which certainly could be true given how many sources the software pulls data from – in all, Rippling integrates with more than 400 apps to automate the processing of your payroll.
A sleek, organized user interface organizes key information like the total hours worked per employee, time off by employee, total labor expenses and more. Further, you can manage direct deposits and paychecks through Rippling so your employees are paid on time in the manner they prefer. Rippling displays all of the tax and benefit withholdings by employee per paycheck, offering a complete record for both employer and employee to reference with ease.
Rippling offers custom quotes based on the services you need, but plans start at $8 per user per month.
To leverage Rippling's payroll processing capabilities, you need to subscribe to the company's Employee Management Platform, a broader HR suite that includes tools like onboarding; benefits; employee changes such as promotions, offboarding, etc.; time and attendance, and device management. Rippling sales representatives will develop a customized plan that meets your business's needs and takes your budget into consideration.
The payroll processing module of Rippling offers automatic compliance and tax-filing tools that can streamline the way you report payroll to the relevant state and local government agencies and remit payments accordingly. Rippling also supports international payments, especially important in an increasingly remote work environment where distributed workforces are the norm.
The payroll module also includes a PTO-tracking tool that allows you to set a custom policy for your employees and then monitor time-off requests with a single click. PTO requests automatically sync with payroll processing and require no additional manual input from managers.
Finally, payroll reporting is custom and powerful with Rippling. You can run a report, for example, that shows your total labor expense in Q1 or a report that shows how much you withheld in employee taxes last pay period. Various visualizations such as donut charts, line graphs and bar graphs can be used to view all your data.
For companies that want an even closer partner, Rippling also offers a PEO service in addition to its employee management platform.
OnPay is our top choice for very small businesses because it handles all payroll and payroll tax needs, has an easy-to-use online platform, and is affordable even on a tight budget. The service costs $36 per month, plus $4 for each employee.
There is only one plan available through OnPay for all customers. The service costs $36 per month, plus $4 for each employee. "Employees" are any individuals you compensate for their services, so part-time employees and independent contractors are considered "employees" and are included in this fee.
The only other additional fee you might incur with OnPay is if you have them print and mail year-end tax forms to your workers. You can print W-2s and 1099s for free, but to have OnPay send those forms through the mail to your office costs $5 plus shipping per form. It costs $6 plus shipping to mail those forms to an employee's home.
OnPay doesn't sacrifice features and value by edging toward simplicity. Users can enjoy payroll processing, tax compliance, multiple employee types, multiple payment options and employee self-service access. This software can also integrate with many popular small business services, like QuickBooks Online, Xero, Kabbage, Humanity, Guideline and ThinkHR.
One of the standout aspects of OnPay is its unlimited payroll runs and automated payroll processing features. OnPay stays up to date with federal, local, and state payroll tax rates and calculates how much your business owes based on where your employees are located. OnPay even takes responsibility for any fines associated with payroll tax errors. If your company offers employees benefits like a 401(k) or commuter benefits, OnPay automatically withholds the correct amounts for these items.
OnPay includes a full suite of HR tools with its payroll services for no extra charge. In addition to online onboarding, companies get PTO accrual and approval, e-signable legal document templates, in-app messaging, secure document storage, and a full library of free HR guides and resources. It also offers an employee self-service portal, where employees can see their paystubs and year-end tax forms. They can also update their banking information or their address, saving time for your staff and ensuring your payroll records are up to date.
The reporting tools give small businesses the ability to create enterprise-level expense reports. The tools can examine 50 different data points, rearrange columns as needed and save the report in multiple views based on who within the company is reviewing it. The reporting functionality is available to all users.
ADP has a strong reputation as a leader in the payroll industry. For complex businesses, including those in highly regulated industries or those operating in multiple states, ADP offers several highly effective tools.
This company offers specified payroll platforms for small, midsize and large businesses. Its Run platform is designed for businesses with fewer than 50 employees, while its Workforce Now platform is for businesses with 50 to 999 employees. Organizations with more than 1,000 employees have various options, including the Enterprise platform.
ADP offers four plans for businesses. Here's what is included in each plan:
The breadth of ADP's services alone makes it a standout payroll provider.
Payroll processing is especially flexible with ADP; you can manage it on your desktop or mobile device (iOS and Android), as well as over the phone. ADP automates payroll tasks like calculating an employee's paycheck based on wages and time off, saving you time and improving accuracy in payroll by reducing the likelihood of human error.
ADP's payroll software can easily integrate with its other services, like its time and attendance software. If you're interested in a full suite of business solutions, ADP gives you several different packages to choose from.
Deluxe shines when it comes to supporting your team in processing your company's payroll and complying with federal and state payroll tax laws. Not only do you gain access to Deluxe's online payroll software, but you are assigned a dedicated customer service team who can offer guidance and serve as a liaison between you and the company. Deluxe also offers additional service beyond payroll, including identity theft protection.
Pricing is customized and depends on the features and services your business requires. Deluxe develops a singular approach for each client, given the consultative nature of its team, so it can be difficult to understand the full scope of services Deluxe can provide to your organization. To better understand all that Deluxe can do for your company and how much it will cost, contact a sales representative, who will give you a custom quote.
Deluxe's payroll processing tool is easy to use; users can complete payroll in three steps. It's also precise, allowing you to adjust pay for fractions of hours worked. It can be used to issue employee checks or direct deposit payments, as well as generate a series of reports to monitor your labor expenses.
You can also work with your dedicated customer service team for tax advice or general guidance. Not only can they help you comply with your payroll tax obligations, they can offer tips to improve your reporting and filing processes to save you time and money.
Deluxe includes employer and employee portals. Employers can run payroll and a variety of reports in their portal, while in the employee portal, workers can look up their paystubs and withholding information, as well as time-off requests and direct deposit information. Employees can also update their information here as well.
Deluxe interfaces with dozens of third-party software providers, including accounting software and point-of-sale (POS) systems. Integration includes seamless data migration as well.
Square is a highly popular payment processing platform, but it also offers Square Payroll, an online payroll software program that is easy to use and makes payroll tax compliance simple. Square automatically compiles and files your federal, state, and local payroll taxes based on the data that already exists in your system, giving you more time to focus on operations.
Additionally, Square offers expert support through a live chat tool that allows you to connect with payroll specialists who can help you manage your business's payroll and improve your process. Square can sync with a wide range of time and attendance systems and POS systems, tracking employee hours automatically. When it's time to run payroll, you can pay employees directly from your Square Balance, rather than waiting for ACH transfers to go through the banks.
Square Payroll is intuitive and easy to use. Like its payment processing counterpart, it doesn't have a steep learning curve, and most users will not be wanting for additional features. Square Payroll can be used to process payroll for W-2 employees and 1099 contractors.
In addition to payroll processing tools, Square offers a team management feature that can help you sync hours, review an employee's performance and manage system permissions for each team member. This is an especially important function in a time where remote work is more common than ever.
There is no contract requirement for Square Payroll, and pricing plans start at $29 per month, plus $5 per employee paid. Alternatively, there is a contractor's only option that charges you $5 per payment with no monthly base fee.
Zenefits offers an easy-to-use payroll system that enables you to run payroll in four steps. Making manual adjustments, such as including bonuses, is easy when running payroll as well. Zenefits' payroll solution offers unlimited payroll processing, wage garnishment support, direct deposits, tips reporting, multiple pay schedules/rate tables, 1099 contractor payments, general ledger reporting and mobile paystubs.
Zenefits Payroll seamlessly integrates with other Zenefits HR modules, including Time Tracking, Benefits and HR. Zenefits Payroll works best when you purchase all of the modules, because these integrations expand its functionality. For example, the connection between Zenefits Payroll and HR enables easy benefits changes and salary changes, while an integration with Time Tracking can automatically tabulate paid time off when running payroll. Zenefits Payroll is an add-on to this larger HR software suite; it costs $6 per employee, per month.
Zenefits larger HR software suite comes with three pricing plans. These include:
Zenefits Payroll can be added on to any of these plans for an additional $6 per employee per month, but it cannot be purchased as a stand-alone product. However, the expanded functionality of the payroll module within Zenefits larger HR software suite may make it a cost-efficient choice for businesses that may evaluate dropping their other HR software in favor of Zenefits.
Paycor is an online payroll software platform that includes an exceptionally user-friendly employee self-service portal, which allows employees to take charge of their time-off requests, monitor their compensation, check their paystubs, manage their benefits, and update their personal or financial information.
Paycor offers three plans, all of which are based on flat monthly rates. This is unlike many of the other payroll software solutions we reviewed, which often included a base rate and a per-employee, per-month fee. Midsized and larger companies could see saving based on Paycor's pricing model, but very small businesses might pay less with a per-employee, per-month model.
Here's a breakdown of the three pricing plans Paycor offers:
While the costs of payroll services differ by company, each provider uses a similar cost structure. There is typically a base fee and a per-employee charge. Our best picks charge base fees of $29 to $150 and per-employee fees of $2 to $12.
How often you are charged also varies by provider. Some charge monthly, while others charge each time you run payroll. The providers that charge monthly allow unlimited payroll runs each month.
While some providers offer just one package that includes all their services, others offer several plans at various price points with different levels of service. For example, the cheapest plan may include payroll processing only, with the most expensive plan handling all payroll tax filing and payment responsibilities.
Besides the monthly or per-pay-run costs, some providers charge for services like setting up the system and completing year-end tax filings.
Many payroll services don't charge any implementation or setup fees. For the most part, getting set up in the software is an easy process that employees can even do on their own. Some companies may charge a one-time fee to transfer over all of your previous payroll and employee data; while this isn't hard to do on your own, the transfer fee might be worth it to save you some time.
When determining the true cost of payroll services for your small business, you need to factor in any taxes and implementation or other fees. Be sure to inquire about fees when discussing prices with vendors.
Before signing up with a payroll service provider, ask the company these questions to get the best deal possible:
It is critical to review the contract thoroughly before you sign anything. Make sure the contract includes everything you have agreed to and doesn't have any built-in price increases after a certain time period.
Also, ask about the process for canceling service. Find out if there are any costs associated with that and how much notice you need to give.
Many payroll providers offer first-time customers a 30-day free trial. This gives you the chance to run payroll at least once to determine how you like the service. In addition, many payroll providers don't require long-term commitments, so if you test it out for a few months and decide the program you selected doesn't fit your needs, you can easily cancel your service and find a better match elsewhere.
Online payroll software encompasses a lot of services. These are some of the most valuable features and services these programs offer.
The primary purpose of these services is to process payroll. This is how your employees are paid. Based on the wage rates you enter and the hours each employee worked, the system automatically calculates how much they should be paid. It applies the appropriate deductions for each employee, such as for medical benefits and Social Security.
One big plus of using an online payroll service is that it handles your business's payroll tax responsibilities. Based on each paycheck, the software can withhold the required employee taxes. The payroll company then fills out and files the quarterly payroll tax reports and pays the appropriate local, state, and federal agencies.
At the end of the year, the software generates the W-2 and 1099 tax forms for each worker. Many payroll companies offer an error-free guarantee. This means that if it makes an error on your taxes, your payroll provider will correct the mistake and pay any fines or interest it incurred.
Each time you hire a new employee, you must report that information to the state. Online payroll services can complete those forms for your business and send them to the proper state agencies. Information on the forms includes the employee's name, address, and Social Security number, as well as the employer's name, address, and federal employer identification number.
Payroll companies offer multiple ways to pay your employees. The most convenient option is direct deposit. With this method, an employee provides their bank account information, and the payroll software automatically deposits the paycheck into their account on payday.
Another option is paper checks. Some payroll providers offer check-stuffing services: They will print the checks, stuff them in envelopes, and then deliver the envelopes to your office to be given directly to employees.
A third option that some payroll services now offer is prepaid debit cards. The money from each paycheck is automatically deposited to each debit card. The employees using the payroll cards then have instant access to the funds.
You can pay all types of employees with online payroll software. The software can process pay for full- and part-time W-2 employees as well as 1099 contractors, including consultants and freelancers. The software treats both W-2 and 1099 employees the same in terms of payment and reporting. All employees are stored in the software; oftentimes, both types of employees can log in to the system to access their payroll records.
Online payroll software can provide a wide range of payroll reports to businesses. These reports can give you better insight into your company and employees. The types of payroll reports that some services offer include payroll registers, contribution reports and payroll tax reports.
A lot of online payroll software includes integrations with programs many businesses already use. These include accounting software, time and attendance systems, and HR software. These integrations allow the two programs to seamlessly connect – data is automatically shared and transferred between the two. This saves you the time of entering the same information in multiple places.
Each employee has their own login to access the software. The employee portal allows them to review their digital paystubs, access their year-end tax forms and check their time-off balances.
Some payroll services provide mobile access to their software. Some have mobile-friendly websites, while others have a dedicated mobile app for iOS and Android devices, allowing you and your employees to access all the same features wherever you are.
Many payroll services include some level of management for your employees' paid time off. This may mean simply tracking PTO accruals, or it may also offer the ability for employees to request and managers to approve or deny time off.
Some payroll companies include human resources services in their platforms. These can include employee onboarding services and tools to create employee handbooks or job templates. Some payroll services even offer on-demand HR consultations.
Online payroll companies offer a variety of customer support options. Some of them assign a dedicated support representative to your company; this is your go-to person for any issue that requires a call. Other payroll services just have a general support number that you call for help. Most companies offer customer support Monday through Friday, though a few have support available over the weekend. In addition to the in-person support you can receive, most online payroll services have extensive resources on their websites, such as how-to-guides, FAQs and videos.
In addition to the core payroll functions, many payroll companies offer a litany of other services that you can tack on to your plan. These include workers' compensation insurance, benefits administration, retirement plans, college savings plans, and time and attendance systems.
There are numerous benefits to using online payroll software. The two biggest are accuracy and timeliness. Online payroll software is critical in ensuring your employees are paid on time and accurately.
The software helps with accuracy because it handles all of the calculations for you. As long as you enter the correct number of hours each employee worked each pay period, the amount they are paid should be correct every time. Since you don't have to do any of the math yourself, this greatly reduces the chance of errors.
In addition, many payroll services are essentially "set it and forget it." Again, as long as you enter the correct number of hours worked, everything else will be handled in time for payday, without any extra input from you.
One of the most confusing aspects of running payroll is making sure the correct amount of taxes are withheld each pay period. Payroll software handles all of that for you, which is a huge benefit. In addition to withholding the correct amount of payroll taxes, some payroll services will fill out the correct federal and state payroll forms and file them for you, along with your payments.
The one potential downside of payroll software is that these are usually cloud-hosted services. This means you are at your provider's mercy in making sure the software is always up and running. If your provider has a catastrophic issue that takes its services offline, you run the risk of not being able to pay employees on time.
Payroll software contains a lot of sensitive data that you don't want unauthorized people getting access to, such as employees' Social Security numbers and bank account details for direct deposit. To keep that data safe, you need to make sure the online payroll software you use has top-notch security protocols.
Among the security measures you should look for when choosing online payroll software are multifactor authentication and high-level encryption. Find out what security certifications the software has and what physical security measures the company takes in the server location where it stores the cloud-hosted software and data.
There are various factors to consider when choosing a payroll service provider, but it all comes down to whether it can serve your company's needs. Will the software make it easy to manage your entire employee roster? Can you run payroll as often as you like? Does it handle all of your payroll tax needs? Does it offer a tax guarantee? Does it provide any added services you want, such as workers' compensation insurance and PTO management? These are all things you need to know about a service before committing to it.
Other factors you should consider are whether it fits in your budget, how easy the online payroll software is to use, and the level of customer support the company offers.
There are many benefits to using online payroll services. Firstly, it makes the process of running payroll simple. These services handle all of your payroll processing and payroll tax responsibilities. All you, as the business owner, are responsible for each pay period is entering the number of hours each employee worked and any commissions or bonuses they earned. You should be able to run your payroll in just a few minutes.
Once you submit this information, the payroll software does the rest of the work for you. It calculates the correct amount for each paycheck and deposits that money directly into the employee's bank account. If they don't use direct deposit, it will let you know when you can print out a paper check for them. The software also automatically calculates the proper payroll tax withholdings and, when the time comes, files the required paperwork and makes the necessary payments on your behalf.
Payroll software also offers employee self-service. Instead of employees asking someone else all of their payroll questions, they can log in to the system to get the answers they are looking for on their own. This saves time for them, as well as those who would be answering their questions.
We looked at a variety of factors to determine our recommendations. We considered the cost of each service, how easy it is to use, what tax services it offers, the integration options, any incentives like free trials or discounts, if self-service is available, how complete the tax services are, extra services (such as HR, time-off management and retirement savings plans), the customer support, and Better Business Bureau ratings and complaints.
After careful research and consideration, our top payroll service selections are Intuit QuickBooks, OnPay, Gusto, ADP and Paychex. Other highly rated services include SurePayroll, Sage, APS, BenefitMall, Fuse Workforce Management, PrimePay and Pay USA. To learn more about each of our best picks, check out our reviews above.
Most payroll software allows you to pay contractors right alongside your full-time employees, though there are some differences with regard to taxes. Taxes are not withheld from a contractor's paycheck. (Instead, independent contractors pay self-employment tax on their earnings.) If you pay a contractor more than $600 a year, you will need to fill out Form 1099-MISC.
A balance sheet reports on a company's finances (including assets, liabilities and shareholder equity) during a certain time period. A balance sheet does not necessarily detail salaries and wages, though unpaid wages can appear as a liability on the balance sheet.
After some preliminary research of our previous contenders and other best-pick lists, we interviewed small business owners to discover new payroll services to add to our list. Our initial list of payroll services we considered for this review numbered 77 companies.
We settled on 17 payroll services to consider for best picks: ADP, APS, BenefitMall PayFocus, Big Fish Payroll Services, Fuse Workforce Management, GetPayroll, Gusto, Intuit, OnPay, Patriot Software, Paychex, Paycor, Paylocity, PrimePay, Sage, SurePayroll and Wagepoint.
Next, we conducted a more in-depth review of each service. We studied their websites and offerings, watched tutorials and how-to videos, read user reviews, looked at Better Business Bureau ratings and complaints, and tested out services when demos were available. After narrowing down the list to 14 contenders, we contacted each company, posing as business owners, to evaluate their customer service.
We analyzed each service based on the following factors:
As part of our research, we reached out to small businesses to find out which online payroll solutions they use and what they find most valuable about them.
John Holloway, co-founder of NoExam.com, said he uses QuickBooks because of how simple it is to run payroll with the software. He specifically pointed to how simple it is to log in and run payroll while updating his books.
"QuickBooks has the most features and integrates nicely with our accounting software, which is the main reason we stick with it," Holloway told business.com.
Marcus Anwar, co-founder of classifieds website OhMy, said he uses QuickBooks for its wide range of features.
"One of the features I really like is how you can pay employees with direct deposit for free," he said. "Many other payroll services charge a fee for direct deposit."
Anwar said he previously used ADP for his payroll needs, but switched because of the added features QuickBooks offers.
"The reason why we switched from ADP to QuickBooks was some of the features we wanted ADP didn't have, and the price was the other important factor," he said. "QuickBooks is cheaper with more options."
Over the past year, the outsourced payroll industry grew 27%, due in large part to the physical limitations of 2020. That growth rate is projected to continue increasing over the coming years. Advances in cloud computing will be the largest driver of its widespread adoption throughout the industry. Businesses are more willing to outsource their payroll due to concerns regarding staff sizes and the increasing number of digital platforms capable of quickly and efficiently handling these functions.
Further, major online payroll software solutions cut their prices in 2020. Entry costs have been lowered because of both global economic damage and the rapid improvements to AI and automation technologies allowing for cheaper implementation. These services will grow in importance as governments update information regarding 2021 sick-leave practices, and their improved automated functionality will help businesses that are prepared to invest more in a 2021 market dominated by freelance work.
Having an online payroll service handle your taxes will remain critical in 2021, with increased uncertainty around the Paycheck Protection Program, unpredictable stimulus packages and political change that accompanies a new presidential administration. Tax season may face delays after the IRS announced that it still holds millions of pieces of unopened mail and incomplete tax returns.
