Best Online Payroll Services

by Chad BrooksLast Modified: February 14, 2018

Intro
Best Picks
Pricing
Negotiation Tips
Reviews
Community Picks & Surveys
What We Tested, What We Found
Payroll Services Infographic
State of the Industry
When Do I Need Payroll Services?
Map
Services
Compare Quotes

The Best Online Payroll Services of 2018

Online payroll services are easy to use and handle all of a business's payroll and payroll tax needs. However, with such a large number of services to choose from, finding the one that's best for your company can be a difficult task.  

There are a lot of factors to consider when choosing a payroll service. The best companies offer all of the services and tools you need, fit your budget, and provide the level of customer support you expect. With dozens and dozens of options out there, we want to help you narrow them down.  

We recommend Intuit, Gusto, OnPay, Patriot Software and Paychex as some of our best picks. You can read more about each, and the types of organizations we think they are best for, below. If none of our recommendations work for you, scroll down even further to see a comprehensive listing of online payroll services.

Best Picks

Larger Businesses
Popular
Small Business
Very Small Businesses
Sole Proprietors or S. Corps.
Paychex - Online Payroll Services

Best Online Payroll for Larger Businesses

Paychex - Online Payroll Services

Paychex is an excellent online payroll service for larger organizations. It offers most of the features businesses look for in a payroll solution and strong customer support.

With Paychex, businesses can enter and submit payroll information online and pay their employees by direct deposit, check or paycard. For paper checks, Paychex can print and mail them to you, or you can print them off yourself.

ADP Enhanced

Most Popular Online Payroll Service

ADP Enhanced

ADP is the most popular payroll service among Business.com readers. Besides its popularity among our own members, it has a strong reputation as a payroll industry leader. It is used by businesses across a wide variety of industries and holds a 12 percent share of the entire payroll industry marketplace, according to a recent report from IBISWorld.

Part of what makes ADP so appealing is that it 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 built for businesses with 50 to 999 employees. Larger organizations with more than 1,000 employees have access to many options with ADP, including its Streamline platform.

Intuit

Best Online Payroll Service for Small Businesses

Intuit

Intuit Payroll provides businesses of all sizes with some or all payroll and related tax services. The Intuit service is available in three different plans, which cost $20 to $99 per month, plus $2 per employee. The basic plan only includes payroll processing, while the enhanced plan includes payroll processing and payroll tax calculations.

With the full-service plan, Intuit files and pays the required payroll taxes to all federal, state and local agencies on your behalf. It also includes a guarantee that if any payroll tax mistakes are made, Intuit will take on any penalties you incur. Intuit offers a 30-day free trial period for all its pricing plans.

OnPay

Best Online Payroll for Very Small Businesses

OnPay

OnPay's cloud-based payroll system handles all payroll responsibilities for small businesses. With this system, businesses can run an unlimited number of payrolls each month and pay both W-2 and 1099 workers by direct deposit or printed checks. Direct deposit payments are made two days after each pay run. Checks can be printed from any standard printer without any special software.

OnPay also handles all payroll tax responsibilities. This includes calculating the payroll taxes each month, filing the required forms, and processing the required payments to all local, state and federal agencies. Additionally, the system prepares and files all quarterly and annual payroll returns and generates the year-end W-2 and 1099 tax forms.

Gusto

Best Online Payroll for Sole Proprietors or S. Corporations

Gusto

Gusto is a cloud-based system that provides all payroll and payroll tax services. With Gusto, businesses can pay and provide year-end tax forms to both full-time W-2 employees and 1099 contractors or freelancers.

The service, which costs $39 per month, plus $6 per employee or contractor, allows businesses to run an unlimited number of payrolls each month. It also includes automatic new hire reporting, the option to run payroll on "autopilot" and the ability to let employees make charitable contributions straight from their paychecks.

Pricing

While pricing varies by provider, most payroll services use a similar cost structure. Most services charge a base fee, plus a per-employee charge.

  • Base fees typically range from $20 to $100 depending on the services.
  • Per-employee costs range from $1 to $12.  

How often you are charged also varies by provider. Some providers charge monthly fees, while others charge each time a business runs payroll. The providers that have monthly charges allow for unlimited payroll runs each month.  

While some providers offer just one package that includes all of their services, others offer several plans at various price points that include different levels of service. For example, the cheapest plan may include payroll processing only, with the most expensive plan featuring additional services, including all payroll tax filing and payment responsibilities.  

Besides the price per month or pay run, some providers have additional charges for things such as setting up the system and completing year-end tax services.

Editor's Note: Looking for information on payroll systems? Use the questionnaire below, and our vendor partners will contact you with the information you need: 

Negotiation Tips

When getting ready to sign up with a provider, there are several steps you should take to ensure you are getting the best deal possible:   

  • Check to see if the provider offers a discount for agreeing to a long-term contract.
  • If you're a midsize or large business, see if the provider offers discounts for businesses with a large number of employees.
  • Ask if the provider would be willing to waive any first-time costs it charges to land your business.
  • See if the provider would be willing to match the price of one of its cheaper competitors.  

Also, it is critical that you review all the contract details before signing anything. Make sure the contract includes everything you have agreed to and doesn't have any built-in price increases after an extended time.  

Additionally, read all the print about canceling the service. Know if there are any costs associated with that and how much notice you need to give.

Reviews

Below are all of our reviews for online payroll services and related categories. Our coverage includes reviews of the best online payroll services and small business online payroll services. See all of our reviews below.

BDC Expert Community & Business Survey Picks

We asked our Business.com community members to tell us what payroll services they use, the features they considered most important and the customer service methods they prefer.

Most Popular Payroll Service – ADP

ADP is the most popular payroll service among Business.com readers. Besides its popularity among our own members, ASP has a strong reputation as a payroll industry leader.  It is used by businesses across a wide range of industries and holds a 12 percent share of the entire payroll industry marketplace, according to a recent report from IBISWorld.

Part of what makes ADP so appealing is that it offers specified payroll platforms for small, mid-size and large businesses.  Its Run platform is designed for businesses with fewer than 50 employees, while its Workforce Now platform is built for businesses with between 50 and 999 employees.  Larger organizations with more than 1,000 employees have access to a range of options with ADP, including its Streamline platform.

While the platforms differ in some of the features they offer and the additional ADP services they integrate with, they all offer the same core payroll services, including the ability to run payroll online, over the phone or via a mobile app.  In addition, they all calculate, file, deposit and reconcile your payroll taxes, come with a tax payment guarantee that no errors will be made and provide employees with year-end tax forms.

Other features the platforms include are automatic new hire reporting, the ability to pay employees via direct deposit, printed check or prepaid debit card and access to a host of payroll, labor and wage reports.

Among the programs the ADP payroll platforms integrate with are HR management, time and attendance systems, talent management, benefits administration and retirement services.  

The cost for ADP’s payroll service varies based on the platform being used and the number of employees being paid.  For a business with 10 employees payroll process and complete tax service, we were quoted prices starting at $60 per payroll run.  The costs increased by about $2 for each additional employee.

Online Payroll Services: What We Tested, What We Found

It's typical for companies to seek out a payroll service as they hire more employees, but outsourcing payroll can be useful no matter how many employees you have. For our evaluation, we posed as a small business with five employees who are paid semimonthly. We compared each provider's equivalent of a full-service package. With these full-service plans, the payroll provider takes care of everything when it comes to compliance and tax matters, and it distributes your pay for you.

Most payroll companies offer similar features. We evaluated each service based on the following four factors:

  • The payroll features the service offers
  • The fees the service charges for tax-reporting purposes
  • The options you have for paying employees
  • Customer help and support

Each of the above categories represents an essential part of the payroll process, and each has a profound effect on your and your employees' experience with the payroll company you choose. We ranked each service on our list, measuring its effectiveness in fulfilling each of these four needs for your company. The services we reviewed had no input or influence on our testing, and they were not provided with any results of our testing before publication.

More Payroll Features Increase Efficiency

The features your payroll service provides is important because it influences your ability to process payroll more accurately and more efficiently. For example, reporting features let you track trends within your business and your employees; other features, like employee-tracking functions, reduce errors and maximize your time. Look for companies that offer a variety of payroll features so you have a comprehensive payroll solution. The best payroll companies, such as Intuit and ADP, offer the widest variety of features to meets the needs of many businesses.

Another important feature online payroll services had to have is that they had to offer easy ways to access your payroll dashboard through mobile devices like tablets and phones. Most of the companies we reviewed offer mobile access to their interfaces. Typically, mobile access is through a web browser on your phone or a downloadable app.

Paying Fewer Tax Expenses Frees Funds

Payroll companies charge you based on a variety of different considerations. When you initially get a quote, it's typically based on the number of employees you have, the methods through which you pay them, and whether or not employees reside in the same state. While these are standard considerations, there are other expenses you might have to pay based on your situation.

Businesses are required to report tax information every year, and most payroll companies will calculate, file and deposit federal and state taxes for you. In addition, businesses are required to report year-end tax information and provide forms like W-2s and 1099s to employees. Some companies, like MyPayrollHR, include W-2 and 1099 processing as part of its payroll package. Most companies charge extra for the service.

Good Support Helps You Avoid Headaches

Payroll is a time-sensitive process, and you don't want to pay government fines for not paying your employees on time. Customer support is an important factor. If you can't get the help you need when you need it, you may introduce errors into your payroll, resulting in fines from the IRS.

All of the payroll services for small business we tested provide support through the standard support channels like phone and email. Only a few, like OnPay and APS, provide support via live chat. Live chat can be incredibly helpful when you need quick answers to simple questions, but if you have more in-depth questions, it's best to call.

You should also have access to online resources, like forums and user communities. Intuit has a strong online presence; it offers up-to-date training videos and helpful guides.

Finally, the payroll company you choose should provide a dedicated account specialist. This account specialist is your go-to point of contact for any problems you encounter. Not many payroll services provide dedicated account specialists, but those that do – like BenefitMall and Paychex – offer a service that is very valuable. You may also want to find a service with 24/7 support so you can always get support, even outside of normal business hours.

Understanding Payroll Services Infographic

State of the Industry

A growing number of businesses find value in outsourcing their payroll. Today's payroll services handle several critical, time-consuming tasks, including payroll processing and the calculating, filing and paying of payroll taxes.  

Experts say that outsourcing payroll not only helps prevent errors, but also frees up employee resources. A recent report on the payroll industry by IBISWorld shows that there are nearly 300,000 payroll and bookkeeping businesses in the United States that employ more than 1 million people. Full-service payroll companies account for 60 percent of the total number of businesses in this industry.  

Overall, payroll and bookkeeping businesses generated $74 billion in revenue last year, up 5.4 percent over the past five years. The industry generated $9.1 billion in profit.  

"As the number of businesses in the United States has grown each year over the past five years, the industry's consumer base has grown and corporate profit expansion has given more businesses the resources to afford outsourcing their payroll," the report's authors wrote. "Over the five years to 2022, revenue is forecast to continue to increase, though at a slower rate compared with the previous five-year period as employment stabilizes, and companies in the industry are expected to attract customers to new cloud-based products and services."  

The report shows that of the businesses in the U.S. using payroll services, the most prominent are technology-producing companies, healthcare providers and manufacturing institutions. Those three types of companies alone account for more than 40 percent of the total organizations using payroll services.  

"Operators in these industries are often highly specialized and prefer to outsource human resources such as payroll and bookkeeping services to focus on their core, profit-generating business functions," the study's authors wrote.

When Do I Need Payroll Services?

Payroll services are designed to help you comply with all of the policies and regulations involved in payroll, taxes and IRS reporting. These services are most useful if you are worried about adhering to federal and state regulations or if your company has been fined in the past for payroll mistakes.

When it comes to managing payroll, you may be using your own accounting software, like QuickBooks or FreshBooks. This kind of accounting software offers the features necessary to help you comply with regulations on your own, but the overall process can be time consuming and complex as you hire more employees. It can be easy to miss things here and there, which can result in hefty fines. You don't want to find yourself in legal trouble because you or your bookkeeper have made a simple mistake when processing payroll. 

You may find that processing your payroll online with a service can bring peace of mind. These services are cost-effective because they help you avoid noncompliance issues and the resulting fines. Purchasing accounting software is much cheaper and can save you money in that regard if you are confident in your own bookkeeping skills. However, having a service handle the reporting for you can save you both time and money if you aren't confident in your skills or when you just don't have the time it takes to process payroll for multiple employees.

The Benefits of Using an Online Payroll Service

Complying with major laws and regulations like the Affordable Care Act (ACA) – which comes into play when you have 50 employees – is one of the biggest benefits of having a dedicated service manage your payroll processing. These regulations typically require you to file certain forms, and if you don't file them correctly, the IRS can fine you. While compliance with the ACA applies to larger businesses, other regulations, like paying your employees on time and correctly, are always required of you, regardless of the number of employees you have.

In addition to federal and state laws, there are lesser-known regulations and other processes involved with payroll that not every company handles on a regular basis. Payroll providers can manage these issues as well to keep your business running smoothly.

Pay Distribution Options

All of the payroll services we reviewed include three options for paying employees: direct deposit, pay cards and checks. If you pay your employees by check, you can pay your employees through any of these methods. However, several states require employees to receive their pay through direct deposit. If those employees don't have bank accounts, you can use pay cards. Instead of cutting a check or depositing money into a bank account, you can load paychecks directly to a card, which your employees then use just like a debit or credit card.

Payroll services know the ins and outs of your state's requirements, and can help you pay your employees in the correct manner. It's best that the provider you hire offers all three options so your employees can choose how they want to receive their paychecks. ADP, IOIPay, Paychex and BenefitMall are the only four companies we tested that offer all three payment options without charging extra.

Worker's Compensation

The best payroll companies offer workers' compensation insurance. All businesses are required by law to ensure employee compensation should anyone be hurt while working.

You can hire a third-party broker to handle this insurance for you, or you can have the payroll services take care of it for you. Companies like Intuit include workers' compensation as part of their payroll service, which means you don't have to hire a separate entity to cover you.

Integration with Other Business Solutions

Payroll is the last step of a long process. Gathering information before payroll can be complex, and many common business solutions integrate well with payroll companies to help the process run smoothly from one step to the next. For example, many time card software solutions automatically convert employee hours into a CSV file. The payroll provider then uses these files to calculate each employee's paycheck.

Most POS systems also integrate well with online payroll services, which is a big help if tips comprise your employees' compensation. Likewise, integration with eCommerce and CRM solutions make it easy for the payroll service to track sales tax and commissions. You need to accurately track and report both sets of data as part of your overall payroll responsibilities.

These are just a few examples of how payroll services can work with other business solutions you have in place to ensure you are reporting payroll properly to the IRS. Each payroll provider we reviewed is willing to create a customized solution for any situation.

Map

YourSource Management Group
69 N. Squirrel Court
Auburn, MI
YourSource Management Group
Gusto
500 Third St
San Francisco, CA
Gusto
FreshBooks - Online Payroll Services
35 Golden Avenue
Toronto,
FreshBooks - Online Payroll Services
KashFlow - Online Payroll Services
4 Tetbury Close
Martland Park,
KashFlow - Online Payroll Services
Xero - Payroll Services
101 Green St.
San Francisco, CA
Xero - Payroll Services
Zoho - Payroll Services
4141 Hacienda Drive
Pleasanton, CA
Zoho - Payroll Services
LessAccounting
11250 Old St. Augustine Rd.
Jacksonville, FL
LessAccounting
Sage
271 17th Street Northwest
Atlanta, GA
Sage
APS
3010 Knight Street
Shreveport, LA
APS
IOIPay
25325 Leer Dr
Elkhart, IN
IOIPay
QuickBooks
5601 Headquarters Drive
Plano, TX
QuickBooks
OnPay
2300 Lake Park Drive
Smyrna, GA
OnPay
Paychex - Online Payroll Services
911 Panorama Trail S.
Rochester, NY
Paychex - Online Payroll Services
ADP Enhanced
135 West 18thStreet
New York, NY
ADP Enhanced
Coastal Human Resource Group
PO Box 161104
Mobile, AL
Coastal Human Resource Group
Intuit
5601 Headquarters Drive
Plano, TX
Intuit
MyPayrollHR
855 Route 146
Clifton Park, NY
MyPayrollHR
PayUSA
1200 High Ridge Road
Stamford, CT
PayUSA

Services

List of 21Best Online Payroll Services

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