The Best Online Payroll Services of 2024

An online payroll service provides businesses with the software and tools to run payroll digitally. Within the payroll service’s software, you enter each employee and some additional details, including their salary or hourly wage, hours worked, their benefit deductions and where they live. With all of this information, the service automatically calculates each employee’s paycheck each pay period and processes the payroll so each employee is paid. Additionally, the vendor withholds and, in some cases, pays your local, state and federal payroll taxes. Such services also provide detailed reporting that lets you know how much you spend on payroll each month and other key data.

Online payroll services help businesses process payroll more efficiently than if they were to do it manually. Using a payroll service also reduces the risk of human error, ensures employees are paid accurately and helps companies maintain compliance with overtime regulations and other laws. These platforms usually integrate with accounting software for seamless financial tracking, especially as it relates to payroll expenses and payroll taxes. This aids your company’s overall financial management.

All businesses with at least one employee should consider using a payroll service to lessen the burden of payroll responsibilities. Companies that want to offer employees multiple payment options, such as direct deposit or payroll cards, should also use online payroll services. These programs also make it easier for businesses with global employees to run payroll and pay team members in their local currency. There is no industry that can’t benefit from using an online payroll service to run payroll and pay its workers.

Payroll software helps you generate tax forms. (Source: Intuit)

The benefits of paperless payroll are vast. Replacing spreadsheets and manual data entry can free your time to focus on core business tasks and improve HR workflows. Moreover, many payroll services go beyond processing payroll and offer additional features for enhancing hiring and onboarding processes. Below are some of the top benefits of using an online payroll service.

Reduce Payroll and Tax-Filing Errors

Payroll services facilitate automatic payroll calculations and tax payments, decreasing the chances of human mistakes. Plus, several top-rated payroll solutions offer tax-penalty protection, promising to pay any IRS penalties if they make a tax mistake on your behalf. Some even allow employees to preview their paychecks for accuracy before employers run payroll.

Improve Employee Experiences

The mobile apps, self-service portals and employee benefits offered via an online payroll service can increase staff satisfaction, resulting in lower turnover and higher engagement. Workers appreciate flexible payment options like direct deposit and payroll cards, which are easier to provide when you work with an online payroll vendor.

Increase Productivity

Payroll software calculates the wages, deductions and withholdings for each employee, which means less manual work. General ledger and time-tracking integrations eliminate the need to enter the same data more than once. In addition, many systems include new-hire reporting services, provide year-end tax filing and boast other tools to streamline HR and payroll processes.

Support Key Business Goals

Technology tools should help your company meet core business objectives, like improving your bottom line or hiring well-qualified job candidates. Payroll platforms can reduce costs while allowing your staff to streamline hiring and onboarding experiences. With the benefits administration services some payroll companies provide, you can reach goals for attracting and retaining employees.

Manage a Global Workforce

In an era of remote work and globalization, many employers seek to hire workers overseas. Online payroll services help you stay in compliance with laws and regulations around the world, which ensures you don’t run into trouble with local governments. Some payroll vendors also provide employer-of-record services.

While the costs of online payroll services vary by company, most payroll providers use a similar pricing structure. There is typically a monthly base fee and a monthly per-employee charge. Our best picks levy base fees of $17 to more than $100 monthly and per-employee fees of $4 to $12 monthly. While certain companies allow unlimited pay runs, some providers apply a fee each time you run payroll or if you want to run an off-cycle payroll.

The cheapest payroll services usually only facilitate payroll processing, while more expensive vendors provide additional services, such as payroll tax filing, HR assistance and benefits administration. These companies typically have a tiered pricing model where plans are offered at different price points. Each plan contains a specific feature set, though you may be able to add on services for an extra fee.

Speaking of extra costs, beware that some providers charge add-on fees for managing year-end tax forms, system implementation and integrations. However, to save you money, a few vendors, such as QuickBooks, offer bundle deals that include both accounting software and payroll software for a reduced price.

Always inquire about sales, discounts (such as for annual billing) and introductory offers, as well as about setup costs. While many payroll services offer free implementation, some charge a one-time fee to import payroll data and set up your account. The more hands-on you want your onboarding to be, the more you’re likely to pay for that kind of assistance.

Before you sign up with a payroll service provider, take advantage of any opportunities to test their software at no cost. Some payroll companies offer first-time customers a 30-day free trial, allowing you to run payroll at least once to determine how you like the service. When you’re ready to commit, ensure the service contract includes everything you’ve agreed to and doesn’t have any built-in price increases after a certain period. Also, ask about the process for canceling the service and if there are any costs associated with terminating your account.

Outsourcing payroll processing and tax filing is a big step for any business. You should consider several factors and thoroughly assess multiple online payroll services before signing an agreement. We recommend following the below steps to choose the right payroll software and provider.

1. Evaluate Your Current Payroll Process

Think about how you process payroll now and look over the results of your last payroll audit. What aspects of running payroll do you want to improve? Business owners often wish to save time while preventing tax and payroll errors. The ability to offer employee self-service options, direct deposit, payroll cards and benefits may also appeal to you. Keep these goals in mind as you move on to the next step.

2. Determine Your Business Needs

To achieve the objectives you identified in the previous step, you need to understand which payroll service features and resources will benefit your company the most. For instance, small businesses with fewer than 50 employees face fewer labor and tax regulations than larger companies but may want help complying with paycheck recordkeeping laws. In that case, they may still want a solution that prioritizes compliance.

Also, consider the experience levels of your HR staff and what types of tools would help them fulfill their roles. If your goal is to streamline the payroll process, you’ll want features that can make that happen. Further, think about the following questions.

• How many employees and contractors do you have?
• Do you need to process payroll in multiple states or foreign countries?
• Will you pay out bonuses, commissions or expense reimbursements?
• Which third-party software applications need to integrate with your payroll software?
• Do you want HR support, resources or features?
• Should your payroll service include benefits management and administration?
• Are you in a niche industry with specific payroll requirements?

The answers to these questions should lead to a set of factors by which you can evaluate each payroll service you’re considering. If a platform can’t meet the vast majority of your criteria, it should be eliminated from contention.

3. Get Professional Opinions

After you’ve narrowed down your list of potential payroll services based on your criteria, read professional reviews like those offered by business.com to learn about each platform in depth and the pros and cons of using it. Also, check out user reviews and software ratings on third-party sites like Trustpilot. Look for patterns of complaints or positive points.

Don’t hesitate to reach out to your professional network, either. Other business leaders often readily share insights and recommendations. Use all this research to further narrow down your options.

4. Obtain Demos and Free Trials

Now it’s time to contact the remaining vendors on your list for demonstrations and free trials. As you test the software, involve staff members who will use the program and encourage them to ask questions. Contact customer service and interact with various representatives to get a feel for how well the company handles support tickets.

5. Compare Quotes and Make Your Decision

The final step is to use your testing experience to determine which payroll providers you’d like to negotiate a quote with. Ask each company the following questions to get the best deal possible.

• Do they offer price reductions for long-term contracts?
• Would they be willing to match the price of one of their cheaper competitors?
• Do they provide volume-based discounts for larger companies?
• Are there fees for 1099 and W-2 form generation?
• Does it cost more for general ledger or accounting integrations?

At this point, the answers to these questions and your budgetary considerations should point you to a purchase decision.

Online payroll services and software range in functionality. Below are some of the most valuable features and tools these programs offer.

Payroll Processing

Full-service payroll services calculate worker pay based on the entered wage rates and hours worked while deducting employee benefits contributions and payroll taxes. Some systems have an auto-pay option for salaried workers, so you only need to approve their payroll each pay period and not worry about reentering their hours worked or other data. Depending on the payroll service, your vendor may allow unlimited payroll runs and one or more pay schedules.

Payroll software supports hourly and salaried workers, part- and full-time employees, vendor payments and 1099 contractors, including consultants and freelancers. Some solutions may let you select individual pay rates (even during the same shift), calculate tip credits, assign bonuses and reimburse expenses.

Payroll Tax

One big plus of using an online payroll service is that it handles your business’s payroll tax responsibilities. Based on each paycheck, the software can withhold the required employee taxes. The payroll company then fills out and files your business’s quarterly payroll tax reports and pays the appropriate local, state and federal agencies.

At the end of the year, the service generates W-2 and 1099 tax forms for your workers. Many payroll vendors even offer an error-free guarantee. If the company makes a mistake on your taxes, they’ll correct the oversight and pay any fines or interest incurred.

Automation

Payroll software is increasingly employing new artificial intelligence (AI) technology. AI automates routine payroll tasks such as data entry, time tracking and calculations. This reduces the chances of human errors and ensures accuracy in payroll processing. Some platforms even let you set up automatic payroll processing.

New-Hire Reporting

When hiring a new employee, you must report that information to the state. Online payroll services can complete the required forms for your business and send them to the proper state agencies.

Employee Payment Options

Online payroll services offer multiple ways to pay your employees. The most common methods are direct deposit and paper checks. With direct deposit, an employee provides their bank account information, and the payroll software automatically deposits the paycheck into their account on payday. With paper checks, you can print them yourself or some payroll providers offer check-stuffing services where they print the checks, put them in envelopes and deliver them to your office.

Payroll cards are another alternative to direct deposit — paycheck funds go onto an employee debit card instead of into a bank account. Also, a handful of payroll services provide on-demand wages. In these cases, workers can request payment in advance of a scheduled pay cycle.

Payroll Reports

Online payroll software typically boasts various reporting tools that give businesses insight into their organization and employees. Common payroll reports include payroll registers, contribution reports and payroll tax reports. Advanced data visualization features can break down workforce costs and benchmark compensation rates.

Third-Party Integrations

Many online payroll software platforms integrate with programs businesses already use. These include accounting software, time and attendance systems, and HR software. These integrations allow the programs to connect seamlessly. Data is automatically shared and transferred between them, saving you the time you’d otherwise spend entering the same information in multiple places.

Employee Self-Service

The best online payroll services give each employee a login to access the software. Their employee portal lets them review pay stubs, access their year-end tax forms and check their time-off balances. Depending on your payroll program, workers may be able to enroll in benefits plans and request shift coverage from co-workers via this portal.

PTO Management

Many payroll platforms have features to manage your employees’ paid time off. This may mean simply tracking PTO accruals or enabling employees to request time off and managers to approve or deny it.

HR Features and Tools

Some payroll companies include HR services in their packages. Customizable offer letters and onboarding tools, like e-signatures, are popular features. Plans may also provide employee handbook wizards, document templates and HR resource libraries.

Customer Service

Online payroll companies typically offer support during weekday business hours, although a few have 24-hour assistance or emergency weekend hours. Some assign you a dedicated support specialist, eliminating the need to go through a call center. While email, phone and live chat are the most common support methods, certain vendors provide customer service through text messaging or Slack. In addition, most online payroll services have extensive resources on their company website, such as how-to guides, FAQs and videos.

Mobile Access

Many payroll providers offer mobile apps. (Source: ADP)

Some payroll services provide mobile access to their software. Options may include mobile-friendly websites that open on smartphone browsers or dedicated iOS and Android apps. These apps let HR leaders run payroll remotely and allow staff to view digital pay stubs and annual tax forms. Others have time-tracking tools with scheduling or PTO management capabilities.

Benefits Administration

Many payroll companies allow businesses to manage employee benefits through their payroll software. Benefits administration services may include health and dental insurance, retirement plans, pre-tax savings accounts and workers’ compensation. Also, several payroll service providers can work with your current benefits broker.

The worlds of online payroll services and professional employer organizations (PEOs) overlap when payroll vendors offer PEO arrangements or PEO vendors provide payroll services.

A PEO service is a partnership in which a third-party HR company becomes your co-employer. Your employees work for both your business and the PEO provider, which handles some or all of your organization’s HR responsibilities. This can include payroll obligations, such as processing payroll, managing payroll taxes and maintaining compliance. With this arrangement, payroll is administered under the PEO company’s tax identification number, not the business’s. A business can choose to work with a PEO to outsource not only payroll but also hiring and onboarding tasks, benefits administration, employee training and more.

In contrast, a PEO payroll service refers to payroll companies that can also act as a PEO. In this case, you can choose between simply signing up for the vendor’s payroll service or also signing a PEO agreement. In the latter instance, the provider would become your co-employer and all the benefits of working with a PEO could apply, depending on your plan. Note that when you work under a PEO arrangement, you may have to pay the vendor based on a percentage of your total payroll instead of on a per-employee basis. Justworks, Papaya Global, TriNet and Rippling are examples of companies that can provide standalone payroll services or PEO payroll services.

Whether you should go with a regular online payroll service or a PEO payroll service depends on a few factors, including your budget. PEO payroll services are more expensive (though they can also potentially save your business money through the more competitive employee benefits they can offer). You’ll also have to give up control of some internal processes.

On the other hand, if managing human resources has become a burden for your business and you don’t have the HR staff to adequately serve your team, a PEO payroll service can meet both your payroll and HR needs. This saves your company time and also reduces your business’s liabilities, as your PEO provider will be handling taxation and compliance on your behalf. But if you don’t want a co-employer and rather be your employees’ sole employer, a PEO arrangement is not for you.

Rippling

Workflow automation reduces task switching, allowing HR professionals to focus on high-level duties. The best payroll services automate tax filing and payroll processing, but none offer extensive integrations and prebuilt automation formulas like Rippling. Its no-code workflow builder can update your accounting software and assign tasks to pay employees a referral bonus or retroactive pay raise. Rippling Unity, the required foundational platform, starts at $35 per month, and Rippling Payroll has an $8 per-employee fee. Get all the details in our Rippling review.

JustWorks

Outsourcing payroll and some HR services to a PEO can help your company save on benefits and payroll expenses. Justworks is an affordable solution with robust online payroll services, employment practices liability insurance and accounting software integrations. Justworks’ pricing starts at $59 per employee per month, which is more expensive than standard payroll software solutions. However, as your PEO, Justworks becomes your co-employer and provides access to a 24/7 customer service team via Slack, phone, email, chat and text. Our Justworks review breaks down the available plans.

TriNet

Entering time card data into a payroll system is time-intensive and error-prone. TriNet solves this problem with native time-tracking tools for on-site, remote and field workers. Built-in scheduling and compliance features help companies comply with overtime regulations and notify employees of new shifts. Price-wise, Trinet is reasonable. The base package starts at $10 per employee per month, or $8 with annual billing, plus an additional $6 per person for payroll services. Read our TriNet review for more information.

Papaya Global

Global payroll is challenging for small and midsize businesses, but Papaya Global makes hiring employees and contractors in more than 160 countries convenient. It supports over 100 payout currencies and offers international employee benefits plans. Papaya Global also leverages AI technology to audit payroll to ensure accuracy and compliance. Global payroll pricing starts at $3 per person per month to add international payments to your current payroll service, whereas full-service payroll costs $12 per person per month. This vendor also operates as a PEO — learn more in our Papaya Global review.

Heartland

Not all online payroll services respond quickly when issues arise. However, Heartland provides on-demand access to professionals who can answer your questions about payroll tax preparation and labor laws. We also like that its HR Support Center includes Ease and Employee Navigator integrations, simplifying new-hire reporting and benefits-related payroll deductions. With this full-service payroll solution and vast HR resources, businesses can prevent manual data entry errors and stay updated on the latest regulations.

Paychex

Paychex offers both HR and payroll solutions. (Source: Paychex)

Large organizations with diverse workforces and multiple locations can use Paychex Flex to serve employees and contractors better while streamlining back-office workflows. This solution offers direct deposit alternatives and employee self-service options. The payroll software integrates with over 250 third-party applications and supports custom integrations through its API Developer Center. Paychex Flex Essentials pricing starts at $39 per month, plus a $5 per-employee fee, and scales to the customizable Paychex Flex Enterprise package. See all plan options in our Paychex review.

To choose the best online payroll services, our team of HR experts and software analysts evaluated an initial list of 77 platforms. After whittling our list down to 17 contenders, eight payroll software programs were chosen as our top recommendations. Our experts and analysts studied each solution’s functionality and evaluated the services on 20 factors.

To reach our final conclusion, we considered various factors categorized by importance. These categories reflect what business owners typically prioritize when selecting and purchasing business software and services.

• Pricing (30%): Our team crunched the numbers and compared features and price points from all the payroll service vendors to uncover which solutions give you the most bang for your buck. We looked carefully at monthly subscription rates, the cost per employee, optional add-ons and any per-payroll fees.
• Features (25%): We looked for standard payroll service functions like payroll processing, payroll tax filing, employee management, reporting and analytics, benefits administration and hiring/onboarding tools. Our team also assessed the availability of integrations with third-party business applications.
• Ease of Use (20%): We leveraged demos and free trials to test each platform’s ease of use. Our team also looked carefully at user feedback and any available mobile apps, both from the employer and employee perspectives, to gauge user-friendliness.
• Customer Service (15%): To ensure you’re well-supported, we assessed the range of customer service options offered by each vendor. This included evaluating phone support availability across different plans and the quality of online resources for self-guided help.
• Expert Analysis (10%): Our recommendations are bolstered by the insights of business.com’s HR experts. Their years of experience with and hands-on testing of payroll software ensures we only recommend the most effective solutions.

By evaluating payroll services based on these factors, we identified not only the most trustworthy payroll software options but also how each platform best fits specific business needs. We recognized that some solutions excel at certain tasks or cater to particular company types. This analysis led to the “Best for” designations you see on this page, ensuring you can easily find the online payroll service that aligns perfectly with your business goals.

To learn more about our methodology, see our full editorial process.