For small business founders, paying their workforce, looking after administrative costs, and filing taxes can quickly become a hassle, especially if there's no payroll team in the initial days to handle these tasks. If you’re a small business owner who’s already looking after multiple business processes, managing payroll as well would add to your burden.
Fortunately, there are multiple software tools to help you easily manage employee compensation. Payroll software not only accurately calculates payroll taxes and deductions but is also a cost-effective solution to automate routine processes such as tax filing and salary disbursement.
Our article highlights the eight best payroll software (listed alphabetically) for small business owners. The featured products are selected from Getapp’s Category Leaders report for payroll software. (Read how we shortlisted these tools at the bottom of this page.)
APS Payroll is an HR and payroll processing solution for entrepreneurs and small business owners.
It automates payroll processes and helps maintain payroll compliance. It lets you manage benefits for on-site as well as remote employees and generate payroll tax reports to get a sense of your finances.
You can set up different payment schedules, payment rates, and payment frequencies for freelancers and permanent employees. The software integrates with multiple third-party accounting and HR tools to help bring all your financial data onto a centralized platform.
APS Payroll offers chat, email, and phone support. It is a web-based tool and also has a mobile app for Android and iOS devices.
Gusto is an online payroll and HR software platform for small businesses and startups.
It automates payroll processes such as calculating taxes and disbursing salaries. It tracks employee work hours and calculates overtime pay based on the logged hours. It can set up recurring payments for third parties, such as vendors and clients, and send payment reminders to clients.
Gusto helps with calculating and submitting local, state, and federal taxes. It can manage employee health insurance and workers' compensation for contractual employees. It stores documents such as I-9s, W-2s, and 1099 forms for your employees to access easily. In addition, it tracks changing tax laws and updates taxation rates to ensure compliance.
Gusto is a web-based tool and offers chat, email, and phone support.
Hourly is a workers' compensation and payroll platform for agencies, small businesses, and startups.
It tracks your staff's work hours, calculates wages based on the logged hours, disburses payments, and files payroll taxes. It features a built-in forms repository from which employees can access forms such as I-9s, W-2s, and pay stubs for filing taxes.
The software tracks taxation laws and calculates taxes based on new policies to eliminate payroll errors. It also notifies you in case of any policy changes.
Hourly offers chat, email, and phone support. It is a web-based tool and also has a mobile app for Android and iOS devices.
Justworks is HR software with added payroll and benefits solutions. It helps small businesses and startups with payroll and employee compensation management.
It lets you create unlimited payroll cycles and automate payroll processing. Once you set a payment date, it automatically processes payment for all employees. It also helps manage benefits administration processes such as deductions and tax withholdings.
The software reports and remits local, federal, and state taxes and manages W-2s and 1099 forms during the tax season. It tracks employee time-off and lets you adjust the payment amount for individual employees based on their logged hours.
Justworks is a web-based tool and offers chat, email, and phone support.
OnPay is a payment processing and HR tool that helps small businesses manage payroll and tax filing.
It automates payroll processing by calculating individual payments for employees based on their roles and sends out scheduled payments each month. It offers multiple payment options, including direct deposits, debit cards, and checks, for W-2 and 1099 employees.
The software integrates with many third-party accounting, bookkeeping, and finance tools to centralize your employee and payroll data onto one platform. It also provides an employee self-service dashboard from which your staff members can access their pay stubs, tax forms, and other documents.
OnPay is a web-based tool and offers chat, email, and phone support.
Patriot Payroll is a full-service payroll and accounting software application for small businesses and startups.
Its dashboard centralizes all your payroll processes, including scheduling payments, filing taxes, and importing tax forms, for quick access. To run payroll, you have to add the payment rates, work hours, deductions, and company-paid contributions for employees.
The software calculates taxes based on your staff's location, allowing your business to manage payroll and taxes even for remote workers. It can integrate with multiple third-party accounting software tools to centralize all your invoice and payment information for tax-filing purposes.
Patriot Payroll offers chat, email, and phone support. It is a web-based tool and also has a mobile app for Android and iOS devices.
QuickBooks Payroll is a payroll management platform built for small businesses and entrepreneurs.
It offers same-day direct deposit so you can send employee payments on time. It automatically calculates and files your payroll taxes during the tax season. It lets you schedule payment cycles for your employees and create and e-file 1099 forms for contractual workers.
The software offers tax penalty protection. Under this scheme, if your business receives a local, state, or federal payroll tax penalty due to an error made while using QuickBooks Payroll, the software helps you resolve the issue and reimburses the penalty and interest costs.
QuickBooks Online Payroll offers chat, email, and phone support. It is a web-based tool and also has a mobile app for Android and iOS devices.
Rippling is a payroll, HR, and benefits platform for freelancers, entrepreneurs, and small businesses.
It syncs your HR data with the payroll system so you don’t have to record outgoing payments manually. It ensures compliance with your area's tax and payroll laws and regulations. In addition, it automatically calculates payroll taxes and files them with the IRS and other federal, local, and state agencies.
If your small business has a remote workforce, the software tracks taxation policies for employee-specific locations and files taxes according to the regional regulations.
Rippling offers chat, email, and phone support. It is a web-based tool and also has a mobile app for Android and iOS devices.
Small businesses have unique needs, which makes it challenging to select a suitable payroll platform. Here are some considerations to keep in mind when evaluating software options:
Check whether the software caters to small businesses. Payroll tools come in all shapes and sizes. What this means is that you shouldn't be buying enterprise-level payroll software for your small business—at least not just yet. When evaluating options, ask the payroll service provider if they cater to small businesses and if they have a specific payroll solution for startups or small businesses.
Inquire whether the software serves your region. The online payroll software you select should operate in your location and be familiar with your region’s taxation laws and payroll regulations. Not serving your business location would be a dealbreaker, so keep an eye out when shortlisting options.
Assess whether the software offers employee segmentation. Your small business might not always work with full-time employees; you might have some contractors and freelancers in your workforce. Ensure your shortlisted payroll software understands this difference and lets you segment employee types for processing payroll and filing taxes separately. The software should also let you generate custom payroll reports for different types of employees.
These are some common questions to ask vendors when looking for payroll software:
Does the software support multi-location taxation and payroll management?
Small businesses often have scattered teams and remote employees working in different locations. The payroll software you choose should be well-versed with the taxation laws of your employees’ locations and should let you file taxes and submit payroll forms accordingly. When talking to the payroll provider, be sure to ask if this payroll feature is available or not.
Does the software integrate time and attendance tracking with payroll?
An ideal payroll tool should track the work hours of all your employees and initiate payments accordingly. Any software that doesn’t track time and attendance for disbursing payments can cause payroll errors and tax filing issues for your small business.
Does the software feature an employee portal?
Select a payroll solution that offers an employee portal from which your workforce can easily access pay stubs, tax forms, and other documents. Having this feature will make data access and tax filing more efficient for your employees.
To find your ideal software match, you need information you can trust—so you can save time, stay on budget, and focus more energy on growing your business. It’s why we vet and verify all our user reviews and recommend only the tools endorsed by people like you.
In other words, our product recommendations are never bought or sold, or based on the opinion of a single individual—they’re chosen by your peers, reflecting the views and experiences of our independent base of software reviewers.
The payroll tools featured in this article are the most recommended based on verified user reviews. However, if they don’t meet your payroll management needs, you can check out our payroll management software directory to find a best-fit solution.
To be featured in this article, products had to:
2. Have at least 20 unique product reviews published on GetApp within the past two years (as of July 12, 2022), with an average rating of 3.0 or higher.
3. Have payroll management, payroll reporting, and tax compliance as primary features along with time tracking, direct deposit, and W-2 preparation as additional features.
4. Meet our market definition for payroll software: “Payroll software automates the management of employees' salaries, wages, bonuses and deductions.”
The eight products with the highest ease of use, functionality, customer support, value for money, and likelihood to recommend ratings are featured in this article. Also, only products that cater to startups and small businesses are taken into consideration.
Disclaimer: We conducted this analysis based on reviews and ratings data as of July 12, 2022. In order to present the most up-to-date information, the product cards show real-time ratings. Please note that this means the ratings value in the product card may not reflect the ratings value at the time of analysis.
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