2022 Gusto vs QuickBooks Payroll: Which Is Better for Your Business?
Charlette has over 10 years of experience in accounting and finance and 2 years of partnering with HR leaders on freelance projects. She uses this extensive experience to answer your questions about payroll.
Juvy has over 10 years of content writing experience and was a licensed teacher. She has evaluated and written about dozens of payroll and HR software solutions for small business to provide the best answers to your software questions.
This article is part of a larger series on Payroll Services.
Gusto and QuickBooks Payroll are affordable software options for small business owners. Both offer full-service payroll with unlimited pay runs and direct deposits, including payroll tax processing and filing. Gusto offers contractor-only pricing, better benefits options, and more human resources (HR) tools. QuickBooks Payroll, on the other hand, offers faster direct deposit processing time and health insurance in all 50 states (vs Gusto’s 39 states).
Based on our comparison, we’ve determined the following:
- Gusto: Best for small businesses needing to run payroll―for employees and/or contractors―plus access to some complementary HR tools and services
- QuickBooks Payroll: Best for small businesses offering health insurance to employees across the United States or those already using other Intuit QuickBooks software
Gusto vs QuickBooks Payroll Compared
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|---|---|---|
Pricing ($/Month) | $39 to $149 plus $6 to $12 per employee; $6 per person (contractor-only businesses) | $45 to $125 plus $4 to $10 per employee |
Direct Deposit Processing Timelines | Two days; a next-day process with premium plans | Minimum next-day process; same-day with premium plans |
Employee Benefits | Health insurance (39 states), life, and disability, flexible spending accounts, commuter benefits, and retirement accounts | Health insurance (50 states) |
Mobile Application | Paychecks, time tracking, tax documents, and Gusto Wallet financial tools available on Android and iOS for W-2 employees; lifetime access | Employees can access pay stubs and W-2s and view paid time off (PTO) balances and withholding allowances online; no lifetime access |
Workers' Compensation | Can purchase and manage within all plans | Can purchase and manage only in premium plans |
Payroll Automation | For salaried and hourly workers | For salaried workers only |
HR Support | Self-onboarding, state new hire reporting, employee directory and surveys, and HR advisers | HR Support Center and HR advisers |
Software Integration | QuickBooks Online, Xero, FreshBooks, Homebase, When I Work, and more | Intuit products |
Customer Service | Able to access unlimited phone, email, and chat support during regular business hours | Phone and chat support available during regular business hours; premium support available with Elite plan |
Key Takeaway: If you need full-service payroll with robust HR support, employee benefits options, and third-party software integrations, Gusto is the best payroll solution for you. Plus, it offers a contractor payroll service that’s low cost (priced at $6 per contractor monthly).
However, if you’re using QuickBooks accounting software and/or want access to health insurance benefits that are not serviceable by Gusto (Alabama, Alaska, Hawaii, Louisiana, Mississippi, Montana, Nebraska, North Dakota, South Dakota, West Virginia, Wyoming) you should consider QuickBooks Payroll. It also has fast direct deposit timelines—wherein the longest is next-day processing and the quickest is same-day processing. Although Gusto offers next-day processing, QuickBooks Payroll’s same-day processing may come in handy in some cases like when you need to process emergency paychecks.
Both providers offer:
- Full-service payroll in 50 US states
- Unlimited pay runs
- Automated taxes and forms
- Deductions and garnishments
- Reporting tools
- Expert product support
When To Use Gusto & When To Use QuickBooks Payroll
Best in Pricing: QuickBooks Payroll
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Both Gusto and QuickBooks Payroll offer affordably priced product plans that come with unlimited pay runs. At first look, Gusto’s lower base fees for the Core and Complete plans may seem more affordable than QuickBooks Payroll’s Core and Premium plans. However, QuickBooks Payroll’s lower per-employee pricing makes it more cost-efficient than Gusto once you have more than three employees. Here’s a comparison of the two providers’ pricing for 10 employees for their Core plans:
- Gusto: $99 per month, calculated as ($6 per employee x 10 employees) + $39
- QuickBooks Payroll: $85 per month, calculated as ($4 per employee x 10 employees) + $45
For $45 plus $4 per employee monthly with QuickBooks Payroll’s Core plan, you get full-service payroll, next-day direct deposit, federal and state tax payments and filings, and access to 401(k) plans and health benefits. You get similar features with Gusto’s Core plan for $39 plus $6 per employee.
However, if you only employ contractors, Gusto offers a contractor-only plan costing $6 per month, per person. QuickBooks Payroll doesn’t have a special pricing scheme for contractors, so you have to pay the same rates as indicated in its three plans.
Best for Payroll Features: Gusto
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|---|---|---|
Direct Deposit Timelines | Next-day, two days, and four days | Next-day and same-day |
Automated Tax Filings and Payments | ||
Year-end Tax Report Prep and Online Delivery (W2s and 1099s) | ||
Payroll Automation | For salaried and hourly workers | For salaried workers only |
Pay on Demand | ||
Pays Employees and Contractors | ||
Files and Calculates Federal and State Taxes | ||
Files and Calculates Local Taxes | Only for Premium and Elite Plans | |
When it comes to payroll processing, Gusto and QuickBooks Payroll have similar feature sets. Both offer automated payroll and tax processing and year-end tax report preparation and online delivery of Form W-2s and 1099s. However, QuickBooks Payroll lacks a pay-on-demand option that allows your employees to be paid their earnings whenever they want.
Also, with QuickBooks Payroll’s Core plan, you get payroll tax payments and filings only for state and federal taxes. For local taxes, you have to print the forms and file them with or upload them to the applicable local sites yourself (unless you’re subscribed to its Premium or Elite plans). Moreover, Gusto’s payroll automation can handle pay processing for salaried and hourly workers, whereas QuickBooks Payroll’s automation is only for salaried employees.
When QuickBooks Payroll’s Payroll Features Are Enough
If you require same-day direct deposits, then you may want to consider QuickBooks Payroll. Gusto provides two-day direct deposits for its Core package and next-day processing for its Complete and Concierge plans.
If you would like to try other options, check our best payroll services guide for small businesses.
Best for HR Features & Employee Benefits: Gusto
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|---|---|---|
Workers’ Compensation | For Premium and Elite plans | |
Health Benefits |
| Health insurance in 50 states |
Onboarding Tools | ||
Generates and Files New Hire Reports | Only generates | |
Offer Letters | ||
Employee Surveys | ||
Employee Directory | ||
Employee Self-service | ||
With Gusto and QuickBooks Payroll, you get a self-service portal that employees can use to view their pay slips and employee benefits online. Both providers also offer access to expert professionals who you can contact to get HR, payroll, and compliance advice.
However, we’ve found Gusto to have better HR functionality. Some of Gusto’s essential HR features include new hire state reporting and a wide range of employee benefits options such as health insurance, commuter benefits, and flexible spending accounts. It even has workers’ compensation administration, a functionality that Gusto offers across all of its product plans. Additionally, you get access to online offer letters, customizable onboarding tools, employee surveys, and a staff directory.
QuickBooks Payroll, on the other hand, can only generate new hire state reports, and you have to file the actual reports yourself. Its benefits options are also limited to health insurance plans, and while it does offer workers’ compensation administration, it is available only for Premium and Elite subscribers.
When QuickBooks Payroll’s HR Features & Employee Benefits Are Enough
Although QuickBooks Payroll only offers health insurance as an employee benefit, what’s great about it is that it covers all 50 US states. Gusto’s health insurance coverage is limited to specific states. At the moment, Gusto doesn’t offer health insurance to the following states:
- Alabama
- Alaska
- Hawaii
- Louisiana
- Mississippi
- Montana
- Nebraska
- North Dakota
- South Dakota
- West Virginia
- Wyoming
Best for Ease of Use, Customer Support & Integrations: Gusto
When it comes to ease of use, Gusto and QuickBooks Payroll have user-friendly and intuitive platforms. Both offer phone support, including access to HR advisers and how-to guides. However, for third-party software integrations, Gusto has a more robust selection.
Meanwhile, QuickBooks Payroll primarily offers integration with Intuit products. If you use your existing accounting software, you’ll have to manually input data from your accounting software into QuickBooks Payroll. With Gusto, you can integrate with accounting, POS, business operations, and time tracking solutions.
- Gusto integrations: FreshBooks, Xero, QuickBooks Online, ZipBooks, Sunrise, Homebase, QuickBooks Time, When I Work, Ximble, 7shifts, Clover, Upserve, Veryfi, Vagaro, and Hubstaff
- QuickBooks Payroll integrations: All Intuit products
W-2 employee information setup
(Source: Gusto)
Gusto & QuickBooks Payroll User Reviews
- Gusto: Users who left reviews on G2 and Capterra rated it 4.3 and 4.7 stars, respectively. Reviewers highlighted ease of use, straightforward and intuitive interface, and good customer support as Gusto’s top features. It also helps small businesses to be compliant legally with wage laws. The complaints, meanwhile, include occasional software glitches and a desire for a wider offering of HR tools, reporting features, and software integration options.
- QuickBooks Payroll: Users gave QuickBooks Payroll 3.6 and 4.5 stars on G2 and Capterra, respectively. Most of the positive comments it received include “easy to implement” and “user-friendly.” There are mixed reviews about its customer support—some users noted its support team isn’t knowledgeable, while others said they received good service. Some also mentioned that it needs to have more robust reporting features.
How We Evaluated Gusto vs Intuit QuickBooks Payroll
To compare the two providers, we looked at the providers’ payroll solutions and HR services for small businesses. Apart from looking at employee pay and payroll tax processing functionalities, we checked whether HR tools and employee benefits are part of their offerings. Ease of use, pricing, and customer support are also key criteria, including whether users have access to expert professionals who can provide HR and payroll advice.
Based on our evaluation, QuickBooks Payroll and Gusto are both easy to use and have similar customer support tools. However, Gusto offered more robust payroll, HR, and benefits features. Gusto also integrates with more third-party software while QuickBooks Payroll is more affordable for small businesses.
Bottom Line
To help you choose a payroll solution that’s best for your business—be it Gusto or QuickBooks Payroll—start by assessing how many employees you have and plan to have in the future, along with your need for HR support and software integrations. You should also determine if you want to offer benefits and, if so, consider if any are negotiable.
If you’re already using QuickBooks’ accounting software, then QuickBooks Payroll may be a better option. The learning curve will be much lower than you’d get with other small business software, and you can provide your employees with health insurance benefits in any state.
However, if you need more than just health insurance benefits to build a quality team or your business and employees are in an eligible state, consider Gusto. You’ll get more onboarding and HR support plus more affordable plan options.
