It doesn’t matter if you are the owner of a small or midsized business or work in the HR department, you realize the importance of choosing a payroll solution that will make life easier on you and your employees.

As your business grows, so does the need for a high quality, reliable, and detail oriented payroll provider. One mistake regarding this part of your business could lead to big trouble down the road. From paying employees the wrong amount to tax related errors, you don’t want to have a mix-up when it comes to your payroll.

With all this in mind, it is time to select the best payroll services for your particular business. Below, you’ll find providers that are trusted by companies of all sizes, spanning a variety of industries.

Challenges of Finding the Right Payroll Solutions for Your Small Business

There are a number of considerations when finding a payroll solution for your small business. First, you need to consider how many resources you have to dedicate to your payroll. Do you have a large finance and human resources team, or will it just be you as the small business owner? If you don’t have a large employee base, it may not be too difficult to run payroll. But payroll processing can be complicated as your team grows. You want to be sure your employees’ paychecks and direct deposits are correct the first time, and that withholdings for taxes, health insurance, garnishment, and other amounts are handled properly. 

Employee time tracking is also an important component of payroll. Accurate pay depends on accurate timekeeping, especially when it comes to overtime and paid time off (PTO). It’s important that your payroll solution have security features that keep employees’ private information safe as well, and that you can prevent fraud. 

Also, there are other legal and compliance issues to consider. Tax filing and reporting to the IRS needs to be done correctly and in a timely manner. Employees’ tax forms need to be accurate also to ensure that their taxes are handled correctly. And there are different payroll laws and tax laws by state and locality that can be hard to keep up with. 

Data entry is another component of payroll that can cause problems for small businesses. The more you can automate, the better, and employee self-service is one great place to start. If employees can upload their tax forms during onboarding and access their pay stubs, health benefits info, and other information through an employee portal, you can save your team time and headaches. 

Small businesses need to know that their payroll solutions integrate with their accounting software and HR software solutions as well. A good payroll solution will have the technology to integrate with other software while also providing solutions to the changing needs of workforces, like remote work or different state laws. The best payroll solution will be user-friendly and intuitive as well. 

Finally, a small business will need to consider how much a payroll solution costs before they implement it. Keeping to your budget is extremely important, but you want to make sure that you have a payroll solution that meets your business needs and offers the payroll features that you need, too. 

Types of Payroll Solutions for Small Businesses

There are a number of payroll solutions that small businesses can consider, depending on your size, budget, and industry. 

Payroll companies

Full-service payroll companies provide a way to outsource your small business payroll completely or get support on some aspects of payroll. They can handle everything to make payday a breeze, including:

• Employee time tracking
• Direct deposit and check printing
• Calculating and reporting payroll taxes
• Ensuring compliance with federal, state, and local payroll laws
• Securely storing payroll data

Beyond basic payroll, they often offer add-ons like HR support services, benefits administration, bookkeeping, and accounting services. In terms of customer support services, you’ll often have a specific payroll specialist assigned to your payroll, so you know who to call when you need help. 

Payroll software

Many small businesses opt for payroll software as a relatively inexpensive option to help them handle payroll. Payroll software provides automated payroll services to help streamline your payroll processes. The best payroll software solution will be user-friendly and easy to set up. (The one thing you don’t want is to spend your valuable time trying to figure out how to use your payroll software).

Other aspects of a good payroll system include:

• Customizable — Look for payroll software with useful templates to help you get up and running quickly. 
• Reporting feature — The best payroll services will give you insight into your HR and payroll, including employee time worked, earnings by department, hours accrued, and payroll expenses compared to yearly or monthly budgets. 
• Integrated — The best payroll software will have multiple software integrations so it syncs with your other business software, especially accounting and HR tools. 
• Reliable — Take a look at other customers’ reviews on software providers to make sure they have a reputation for good customer service and support. 
• Convenient —  Find a payroll service provider that meshes with your business needs, such as a mobile app and online payroll services.
• Appropriate pricing — You may be able to find a free payroll service with unlimited payroll runs, but sometimes this comes as an additional cost to HR software or services. 

Payroll loans

Payroll is one of the most consistent expenses that small businesses have. When cash flow is tight, some small businesses turn to payroll loans to help fill in the gaps. These are small business loans that you can take out specifically to pay your employees, cover payroll taxes, or pay for employee benefits. It’s important to find a loan with a low interest rate and good repayment terms, and to make sure you can afford to pay it back. Most lenders will look at your credit scores (including business credit scores) to assess your creditworthiness, and your rates may change depending on your qualifications. You can use Nav to find the payroll loans you’re most likely to qualify for based on your business data and needs. 

Best Payroll Solutions for Small Businesses

Here are a few payroll solutions that may be good for your small business. 

Gusto

Gusto is online payroll software built for small businesses. Use Gusto for full-service payroll, plus other HR systems, such as:

• employee benefits
• time and attendance
• hiring and onboarding
• Talent management
• Reporting and insights

Homebase Payroll

Homebase Payroll allows you to do unlimited payroll runs for a set price of $39/month + $6/month per employee. It handles timesheets, tax forms, automated tax payments and filings, direct deposit and printable checks, and employee self-onboarding. Plus, it offers a number of other HR tools in addition. 

Online Payroll by Intuit Quickbooks

Quickbooks Payroll is a popular option for many small businesses, especially given its easy integration with the popular Quickbooks accounting software. In fact, more than one million companies rely on Intuit as its payroll provider. As your business grows, Intuit has the ability to scale to meet its every need.

Sage Payroll

Sage offers a number of HR software tools for businesses of all sizes, and is set up to grow with you. With Sage Payroll, you get to decide how much help you want based on which tier you select. The software is cloud-based, so you can use it anywhere, which makes it great for distributed or remote teams. It also offers payroll tax filing, integrations with accounting software, and human resources data management, including new hire reporting. 

Square Payroll

Square is probably best known for their point of sale (POS) software, but Square Payroll is another aspect of its software that is built for small businesses. You can track time, automatically file taxes, run payroll, and manage employee benefits, plus import tips and manage your teams. 

ZenPayroll

Since its official launch in December 2012, ZenPayroll has quickly moved to the forefront of the industry. With its cloud-based payroll solution, free trial period, no long term contract, and availability in all 50 states, there is a lot to like.

It is difficult to pinpoint the biggest benefit of ZenPayroll, but many agree that the easy-to-use backend is the primary advantage when compared to the competition.

SurePayroll

As the first online payroll company to pay and file payroll taxes on behalf of customers, SurePayroll is an industry pioneer. This experience, combined with a powerful system, has helped the company become one of the top providers in the industry.

Despite the fact that SurePayroll was acquired by Paychex in 2011, it remains dedicated to serving small and midsized businesses.

OnPay

Every year, OnPay processes more than $400 million in payroll. The company may not be as big as its primary competitors, such as ZenPayroll and SurePayroll, but it continues to provide reliable service at an affordable price.

While it may not be fair to call OnPay “barebones,” it doesn’t share the same level of features and detail as the competition. Even so, its benefits run deep.

Final Word

Are there other payroll solutions for small and midsized businesses? Most definitely. However, these four continue to outperform the rest of the industry.

If you are selecting a payroll provider for the first time or looking to make a change, compare the pros, cons, features, and pricing structure of the four companies detailed above. There is a good chance one of these providers will offer a solution that suits all (or most) your payroll requirements.