Jason Fell
Jason Fell

We may earn an affiliate commission from partner links on the Entrepreneur Guide. These do not affect our editors’ opinions.

Every business, large and small, can benefit from using excellent payroll software. If you want to take some administrative burdens off your shoulders, a payroll system can be a good investment for your business. We have listed the five best payroll software options for 2023 below.

  • 1. Intuit QuickBooks Payroll

    4.9
    LEARN MORE On Intuit QuickBooks Payroll website
    Starting Price
    $37.50 month
    Benefits administration
    Yes
    Contractor payments
    Yes

  • 2. Paycor

    4.2
    LEARN MORE On Paycor website
    Starting Price
    $99 month
    Benefits administration
    No
    Contractor payments
    Yes

  • 3. OnPay

    4.5
    LEARN MORE On OnPay website
    Starting Price
    $40 month
    Benefits administration
    Yes
    Contractor payments
    Yes

  • 4. Gusto

    4.0
    LEARN MORE On Gusto website
    Starting Price
    $40 month
    Benefits administration
    Yes
    Contractor payments
    Yes

  • 5. Paychex

    3.7
    LEARN MORE On Paychex website
    Starting Price
    $39 month
    Benefits administration
    No
    Contractor payments
    Yes

  • 6. ADP

    3.7
    LEARN MORE On ADP website
    Starting Price
    $59 month
    Benefits administration
    Yes, at an extra cost
    Contractor payments
    No

What should I consider when choosing a payroll service?

Some of the features to keep in mind when choosing a payroll provider are:

  • Direct deposit options
  • Payroll tax filing 
  • Employee self-service and onboarding
  • Integration with other accounting software 
  • Reporting
  • Automatic compliance updates

Best payroll software options of 2023.

1

Intuit QuickBooks Payroll

4.9

Benefits administration:Yes

Contractor payments:Yes

Base monthly price:Starting at $37.50, $5 per employee

Learn MoreOn Intuit QuickBooks’ Website
Overview
(Collapse)

Intuit QuickBooks Payroll is well versed and well known. It is rated highly due to its specially integrated payroll solutions and is a logical choice for a payroll service if you already use QuickBooks for accounting. 

The benefits of QuickBooks are that there is benefits administration at all levels, time-tracking features available for premium and up, next-day direct deposit, HR support, 30-day free trial, and easy integrations. 

QuickBooks is a well-trusted option for businesses large and small. 

2

Paycor

4.2

Benefits administration:No

Contractor payments:Yes

Base monthly price:Starting at $99 per month, plus $5 per employee

Learn MoreOn Paycor’s Website
Overview
(Collapse)

Paycor is a full service human capital management software that can be used for payroll. Although it’s one of the pricier options on the list, they offer many features that other payroll administrators do not, such as a mobile app, employee self-service, and unlimited payroll runs.

There are 4 separate plans for small businesses covering up to 50 employees. Companies with more than 50 employees can contact Paycor directly for a customized quote. Each plan includes automated payroll, federal and tax filing, employee self-service and mobile access for both employees and administrators. On-demand pay allows employees to get paid when they need, as opposed to waiting for a specific payday.

Paycor is a great option for any small business, especially those that have contracted and full-time employees. Not only do you get access to payroll software, but also HR tools and features like a mobile app and on-demand pay that benefit your employees and yourself.

3

OnPay

4.5

Benefits administration:Yes

Contractor payments:Yes

Base monthly price:$40, plus $6 per employee

Learn MoreOn OnPay’s Website
Overview
(Collapse)

OnPay is one of the best payroll services on the market, and is one of the best options for its value and full-service features. It is an all-in-one payroll and HR solution geared toward small businesses. 

When we say all-in-one, it provides payroll, HR, and benefits for one low price of $40, plus $6 per employee per month. It includes must-have features, including automated taxes, accounting integrations, payroll reporting, all-inclusive pricing, employee self-service, built-in HR, and workers comp benefits. 

OnPay is an excellent option for a payroll service for small businesses, startups, entrepreneurs, local shops, nonprofits, religious organizations, and farm owners.

4

Gusto

4.0

Benefits administration:Yes

Contractor payments:Yes

Base monthly price:$40, plus $6 per employee

Learn MoreOn Gusto’s Website
Overview
(Collapse)

U.S. News rated Gusto as the best overall payroll software for 2022. Gusto is designed specifically for startups and small businesses and explicitly targets solutions that these types of new businesses need that are not readily found on other payroll service platforms. 

This payroll software’s all-in-one platform includes full-service payroll, employee benefits like health insurance and 401k’s, time and attendance tracking, hiring and onboarding, talent management like performance reviews and learning tools, and insights and reporting. 

Similarly to OnPay, Gusto has a base fee of $40 per month and $6 per employee per month. 

Gusto is a good option for startups, growing businesses with a mix of employee and contractor-based workers, and entrepreneurs who want to automate their business processes as much as possible so they can limit administrative employees and focus more on their business as a whole.

5

Paychex Flex

3.7

Benefits administration:No

Contractor payments:Yes

Base monthly price:Starting at $39

Learn MoreOn Paychex’s Website
Overview
(Collapse)

Paychex is a payroll and HR service that offers two platforms, denominated by size. Paychex Flex is a simplified platform designed for businesses with fewer than 50 employees, and Paychex Oasis is designed for larger companies. 

Specifically, Paychex Flex is an easy-to-use payroll processing platform that can pay employees and independent contractors but does not include HR and benefits administration. Because this platform is so simplified, it strips away the more complex features of the other PayChex platforms. 

Similarly to ADP RUN, Flex is geared to small businesses with fewer than 50 employees. Paychex Flex integrates with other Paychex products to have your payroll and HR features and third-party accounting systems to keep up to date with data and bookkeeping. 

The pricing starts at $39 and goes up depending on the size of your business. Paychex Flex is suitable for small businesses needing a simple and limited payroll system that meets their needs. As your business grows, you can easily add more features as required.

6

ADP

3.7

Benefits administration:Yes, at an extra cost

Contractor payments:No

Base monthly priceStarting at $59 per month

Learn MoreOn ADP’s Website
Overview
(Collapse)

Unlike OnPay and Gusto, ADP is one of the largest payroll service providers in the world. ADP RUN is ranked highly among growing businesses, especially those expecting to grow into a larger enterprise. 

The comprehensive platform of this service contains a simple interface with payroll benefits and an administration platform.  It offers tiered plans with payroll by direct deposit, an employee self-service platform, new hire onboarding, and optional benefits administration for an extra cost. You can also add time-tracking features and tax form filing for an additional fee. 

The price of ADP starts at $59 per month, plus $4 per employee per month and additional features for an extra cost. This pricing is very doable for bigger businesses and enterprises, but for smaller companies, this pricing can add up quickly. There are differently priced platforms for each company that are customizable based on features and sizes. 

This payroll service is ideal for businesses needing customizable payroll and benefits platforms. ADP Run is geared more toward companies with fewer than 50 employees, whereas ADP Enterprise is better for bigger businesses with many more employees. 

What is payroll?

Investopedia defines payroll as a list of employees in a company and how much they get paid. Payroll also covers all aspects of an employee’s pay, including preparing checks, withholding taxes, and keeping records of gross and net pay throughout the year. 

Companies tend to designate human resources departments to run payroll unless an owner or an associate directly handles basic payroll and the employee information that comes with it. Almost all businesses use payroll software.  

What are the basic steps of payroll?

Payroll consists of multiple steps that must be completed before a new employee’s first day on the job.

  • Set a pay cycle: This is the frequency with which you pay your employees. This can be set at a weekly cycle, biweekly, or monthly. 
  • Gather important employee documents: The documents can include W-4 or W-9 tax forms, state tax withholding forms, and bank account information via a direct deposit form and voided check.
  • Calculate gross pay: Gross pay is the amount an employer is due to pay an employee before taxes are deducted.
  • Calculate net pay: Net pay, also known as take-home pay, is the amount an employee will take home after subtracting all deductions and taxes from the gross pay. 
  • Initiate payment: Initiating the payment means you will cut your employees’ checks and pay stubs or initiate the direct deposit to transfer. Typically, payment initiation is executed by a business owner, HR department, or payroll software. 
  • Pay taxes and record payments: Finally, you will pay the taxes you owe to the state and city and keep records of all payroll and taxes. 

How does a payroll service work?

Each payroll software has its unique make and design, but most online payroll services work similarly. They usually include a cloud-based payroll portal for both employers and employees. The business owner/employer, account, bookkeeper, or HR personnel must set up benefits packages, salaries, PTO, and other payroll add-ons and options. 

With the payroll service, you can typically invite new employers to self-onboard through an employee portal or mobile app and input their necessary payroll data and direct deposit information. These HR software tools provide more payroll options, helping to streamline the payday process and ensure a more user-friendly software solution for employees.

Some services offer automated payroll so you can set up employee pay and track their time. If they do not have automation, you will have to input and initiate payroll manually. 

Different-sized businesses have different workflows, outsourcing levels, and human capital management levels. Unsurprisingly, HR tools for small business payroll may be way too time-consuming for larger companies. 

At the same time, the software that’s best for more prominent businesses may have too high a base price and seemingly unnecessary garnishments for small business owners to justify the investment. 

Bottom line.

Choosing to invest in payroll management software for your growing business is something you will not regret. As a business owner, you have many responsibilities and tasks that demand your attention, so relying on a trusted service to handle your payroll needs is a must. 

For more information on starting a new business, visit us at Entrepreneur.com.

Share article: