7 Best Payroll Software for Small Business

Gusto ranked high among its competitors for its all-in-one payroll, benefits, and HR solution at an affordable price. It enables small businesses to operate with the structure and amenities that some larger companies offer. It comes with unlimited payroll, automatically calculates and remits taxes, and prepares and files year-end reports. Also, it sends out an onboarding email notice to each new hire, so they can complete the required paperwork before coming into the office. Benefits are available, and if you’re in one of the 39 states it offers insurance, you can offer national health insurance plans to your employees.

You can pay employees via direct deposit, manual check, or even pay card at no additional cost, and employees have lifetime access to view their pay stubs and W-2s through their self-service portal. Access to employee savings and an emergency fund through Gusto Wallet is also possible. Gusto integrates well with leading accounting, time tracking, and POS software like QuickBooks, Xero, Homebase, TSheets, Clover, Upserve, and more. If you ever need help, you can get customer support and expert advice through phone, email, or live chat.

QuickBooks Payroll is the best option for most QuickBooks accounting users; it integrates seamlessly—you access it within the same system with the click of a button—and all information flows throughout (you don’t have to enter twice). Employers have complete control of their payroll as QuickBooks allows you to approve your employees’ work hours before a payroll run. It also automatically calculates, files, and pays your taxes, and manages your garnishments and deductions. You can create and download a variety of reports like payroll history, bank transactions, and contractor payments.

Similar to Gusto, QuickBooks Payroll also offers your team access to their pay stubs, W-2s, PTO balances, and withholding allowances online. They can get their salary through same-day or next-day deposit, and you can have them get early access to their pay. It is also accessible in all 50 states. For errors made while using QuickBooks, aside from helping you resolve it with the involved government agencies, it will also reimburse and cover any penalty and interest cost, if you sign up for a premium plan (Elite).

OnPay differs from some providers like Gusto and QuickBooks Payroll because it makes it easy for agricultural companies to pay employees and file taxes. It files Form 943 and processes payments and taxes for workers on H-2A visas. It also allows you to run payroll as often as you need and choose multiple pay rates and payroll schedules for different employees.

You can still file the basic payroll tax forms, Form 941, 1099, W2s, etc., and withhold your employees’ state and federal unemployment insurance payments and other contributions, so the average small business beyond agricultural companies would find it useful.

Patriot offers a flexible option that others on our list don’t; a choice between full-service payroll and a more affordable DIY version that costs only $10 monthly plus $4 per employee/month, if you file your own taxes. Both plans come with unlimited payroll runs using any gadget, allow different payroll frequencies, and customizable hours, money, and deductions. And you can pay your employees through direct deposit or manual checks. Using the Full-service plan allows you to file and pay all federal, state, and local taxes, regardless of location, and offers a penalty-free guarantee.

Your employees can get access to an employee portal for their pay stubs, pay history, time off balances, and electronic W-2 information. Once you are signed up, you can also have a free setup and expert support via phone, email, or chat.

Square Payroll is the best choice for retailers and restaurants already using Square’s free POS system. It enables owners to pay both employees and contractors and imports timecards from the Square POS and other third-party partners. It also has tip reporting features that allow you to record tip amounts, deduct taxes from it and report them on your tax forms. You can run payroll as often as you need to at no extra cost unlike some plans under the big-name providers like ADP or Paychex, and file quarterly and annual taxes plus sign up for pay-as-you-go workers’ compensation insurance.

ADP Run has numerous plan options to cater to different sized businesses. It has an entry-level plan that’s comparable to the other software on our list. It comes with unlimited payroll runs and no setup fee, although the base fee is more expensive. Its other plan options target both businesses with 50 employees or less and those with more than 50 all the way up to 1,000+. These come with extra support and handholding you don’t get with your typical small business payroll software like Gusto or Square Payroll, and ADP makes it easy to transition from one plan to the next in the event that your company will be scaling over time.

The other differentiating factor with ADP Run is the availability of advanced HR features. It comes with onboarding support but also helps with hiring, i.e., background checks, training tools, and talent acquisition plus performance management, compensation management, etc. Many of these are more suitable for businesses once they’ve scaled past the startup stage, but it’s nice to know that once you’ve signed up with ADP, it will be available; with other providers on our list, i.e., Gusto, Patriot, you’d have to leave completely to transition to a new solution.

Paychex Flex isn’t the cheapest payroll solution on our list but maybe more valuable if your business has employees in multiple states and you are continuing to grow. Similar to ADP, it has numerous plans that are flexible and cater to companies of different sizes. You can process payroll in all 50 states and provide insurance—Gusto currently only offers it in 39 states. In addition, if you’re just starting out, Paychex has a Paychex Solo product that’s more suitable for a one-person business.