Best Small Business Payroll

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Many small businesses start out with just a founder and a dream — that’s you. Then, if you’re successful, you grow that dream, and eventually, you need employees. It’s an awesome milestone to hit (and a great feeling to be able to provide employment), but being the boss comes with a lot of responsibilities, and your biggest one is handling payroll.

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Payroll is more than just cutting checks. An effective payroll process tracks employee earnings, manages the wages and salaries you pay out, keeps you in tax and workers’ comp compliance, avoids expensive mistakes, and trims the fat of extraneous costs. To do all these things effectively, it’s well worth considering utilizing a payroll service that you can work with and rely on, just as your employees rely on you. 

What to Look For in Payroll Software

If you’re feeling like you can handle tracking your employee’s hours and writing checks on your own, consider the fact that 45% of small businesses use a payroll service. When you DIY, you leave yourself vulnerable to mistakes like late payments (about a quarter of employees have experienced a late or bounced paycheck, and that number is highest in employees who work for very small businesses). You also commit to a lot of tedious-yet-critical work like figuring out your employees’ tax withholdings. Often, delegating these tasks to a payroll service makes good sense for both your finances and your workflow. 

So what should you look for in a payroll service? These attributes will help keep your payroll process accurate and simple. 

  • Flexible payment options allow your staff to choose how they’d like to be paid (some services offer payment cards, while others have the option to choose between a traditional paycheck and direct deposit). Options are key. 
  • Tax filing is perhaps the most complicated part of payroll (and the part that is the most catastrophic to mess up). A full-service payroll can file your quarterly and annual tax returns for you. 
  • Wage and tax numbers can be calculated by automated payroll processing. Think about the difference between crunching pages of numbers hoping you don’t make a mistake, and being served a clean, reliable document with all your relevant wages, taxes, and deductions already calculated for you.  
  • Time tracking integration is a feature that makes manually keeping hours a thing of the past. This eliminates a constant source of low-key busy work for both you and your staff. Some payroll services offer integration with benefits and other HR programs as well. 

And these will let you use your payroll service to its maximum potential, including helping you grow your business:

  • With analytics, information like how much you’re paying out in wages, how much tax you’ve deducted, and how many hours your staff has worked can be reported directly to you, with information current up to the minute and all in one place.
  • Scalability to grow with your business is key if you’re expansion-minded. Maybe you just have two employees now and offering them 401(k)s seems like a far-off dream, but in a few years, with some luck, you might be there — and you want your payroll service to be able to get there with you. 
  • Compliance with tax and other governmental obligations (like workers’ comp) is part of the package with some payroll services, which offer access to all the forms you need and ping you with relevant updates to wage and tax laws. 
  • A mobile payroll app lets you utilize dead time to handle payroll and allows your employees to check their wage information without having to go through you.  

Your Options

There are so many payroll services out there that deciding on one can become a job in and of itself. You want to look for one that specifically serves small businesses — because you don’t want to be navigating a bunch of tools geared toward global-scale clients with teams in the thousands, or paying the higher prices these tools command. Here are some of our top picks. 

QuickBooks Payroll

If you use QuickBooks for your bookkeeping, it’s worth considering their payroll service, which is consistently popular with small business owners. Like all services in the QuickBooks suite, the software is intuitive, simple, and doesn’t require any specific expertise to operate. Bonus features include a free 24-hour direct deposit with same-day capability, comprehensive tax compliance, and automatic tax updates. The biggest selling point, however, is the ability to get tax forms and then file and pay your taxes within the platform. 

Pricing can be bundled with other QuickBooks services and starts at $22.50/month for your first three months (after which your monthly payment will be $45) plus $5 a month per employee for Payroll Core.  

Wave Payroll

Wave is super simple. It lacks a lot of features the bigger payroll companies offer, but it can be a good fit for very small businesses with just a handful of employees and straightforward financials. If you’re overwhelmed by the idea of interfacing with payroll software, Wave is worth looking into, because that simplicity translates to extreme ease of use (along with robust support via email and live chat). One thing to note about Wave is that it only offers tax filing and payments in 14 states, so if you’re outside their service area, you might want to look elsewhere. 

Wave is reasonably priced and offers a free 30-day trial. With Wave offering tax services, you’ll pay $35 monthly plus $6 per employee or contractor per month. In states that aren’t covered by tax services, it’s just $20 monthly plus the same $6 per employee fee. 


Designed specifically for growing small businesses, Gusto has lots of the features you need for payroll, compliance, and benefits administration, all in one relatively accessible program that is easy to navigate. 

Gusto offers three pricing tiers (which you can move between once you’re a client): Core, intended for small teams, has a base fee of $39 per month plus $6 per employee. If your business is expanding, you can always move up to Complete ($78 monthly plus $12 per user), and if you keep growing after that, there’s always enterprise-intended Concierge ($149 monthly plus $12 per user), which comes with certified HR support. 

ADP Workforce Now

If you’re running a midsize small business, ADP was made with your needs in mind. Fully-cloud based, ADP is heavy on HR features like employee onboarding and time and attendance tracking. You and your staff can manage their benefits with options like IRS compliance, a COBRA events module that helps employees keep track of their COBRA requirements, and status and confirmation reports on beneficiaries, dependents, enrollment, coverage level, and more. Your employees can access their own wage and benefit information through the ADP app.

ADP is custom-priced according to the specific needs of your business. To get a quote, enter the size and location of your business and opt-in to the additional features you’re interested in (like retirement, workers’ comp, time and attendance, insurance, and professional employment organizations). 


Forbes named OnPay Best of 2022 for small business payroll service, and for good reason. Best for flexibility and scalability, OnPay serves small and medium-sized small businesses. Everything in the OnPay universe is adaptable to your needs — for example, you can input data like tips, reimbursements, and bonuses. OnPay is a great choice if you rely on both W-2 and 1099 workers and allows you to pay your staff via check or direct deposit. It’s worth noting that to use some of OnPay’s features, you must submit an application and pass a risk assessment test. 

OnPay has some of the fairest and most transparent pricing structures out there: just $40 base per month plus $6 per employee, no matter what. 


Justworks handles payroll, HR, benefits, and compliance. Features include excellent new-employee onboarding, adjustable benefits, and shift schedule tracking. Justworks is a great fit for businesses that have many different types of staff. It can be hard to manage hourly, salaried, and contract workers all in one place, but the high level of automation within Justworks handles it seamlessly. 

Justworks’ pricing structure is a bit different from some of its competitors, making it rather expensive for businesses with just a handful of employees but potentially a good deal for bigger teams. The Basic plan starts at $49 monthly per employee ($59 for teams under 50 people), and the Plus plan starts at $89 ($99 for teams under 50 people) monthly per employee.   

Upleveling Your Payroll 

Making the decision to use a payroll service is a big step toward automating the less-exciting parts of your business. After all, you started your small business because you are great at one specific thing — and chances are, being a payroll expert isn’t that thing.

Giving yourself the gift of time, focus, and security by delegating your payroll is like finding extra time in the day. For your employees, it is far preferable to deal with an expert service than to have to bug you with questions about their hand-written paychecks. Here’s to finding the payroll service that works for you.