Best Payroll Software for Small Business in 2025: A Complete Guide

With 100+ payroll platforms promising everything from automatic tax filing to direct deposit magic, you could easily lose hours to researching the best payroll software for small business.

Good news: we’ve done it for you! In this guide, we’ll help you cut through the noise and find the right fit: what makes payroll software “best,” what features actually matter, and how to choose the option that fits your budget and your bottom line.

TL;DR: Best payroll for small business

Short on time? Here are our top picks for the best payroll services for small businesses:

• Homebase: Best software for hourly retail and restaurant teams who clock in and out—includes payroll, time tracking, scheduling, compliance, and tip management (yes, all in one!). Also includes a free tier for very small teams.
• Gusto: Best payroll system for benefits-focused professional services for salaried teams that need HR tools.
• Quickbooks Payroll: Best payroll and accounting software for businesses already using QuickBooks accounting.
• ADP Run: Best payroll software for established businesses looking for enterprise-level features.
• Square Payroll: Best payroll system for businesses that are already into the Square POS life.
• Wave Payroll: Best affordable software for microbusinesses with simple payroll needs.

The must-have features of small business payroll software:

• Ease of use and short setup time.
• Cost transparency (and value!).
• Compliance and tax handling features for federal, state, and local taxes.
• Integration capabilities with your existing tools.
• Quality ongoing customer support.
• Scalability as your team keeps growing.
• Industry-specific tools (tips for restaurants, seasonal staffing for retail, etc.).

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What makes the best payroll software for small business?

The best payroll software for small businesses will help you stay on top of hours, wages, and taxes—even when your day starts with a no-show and ends with a double shift.

To keep things running smoothly, here are the payroll software features to keep in mind.

Essential payroll features for your small business

Your payroll software should match your business, not the other way round.

When you’re looking through your options, be sure to consider:

• Ease of use and setup time: Choose payroll software that’s quick to set up and easy to navigate. A clean dashboard and mobile apps are key for on-the-go management.
• Cost transparency and value: The best payroll services for small business offer clear pricing based on your team’s size and needs—no surprise fees, just pay for what you use.
• Compliance and tax handling: Good software handles tax calculations, filings, and deposits automatically—keeping you compliant and avoiding costly mistakes.
• Integration capabilities with existing tools: Your payroll platform should connect with software for time tracking, HR, and scheduling to eliminate double data entry.
• Customer support quality: The best payroll companies for small business offer real, responsive support via phone, chat, or email—so you’re not stuck troubleshooting alone.
• Scalability as your team grows: Your payroll management software should grow with you, supporting multiple pay types, overtime tracking, and benefits administration as your team expands.

Ready to check every box? Homebase brings the essentials together—automated payroll, compliance tools, HR support, and real human help when you need it.Some industries require specific payroll considerations

The best payroll for small business will look different depending on what type of business you’re actually running.

Here are some industry-specific features to keep in mind:

• Restaurant and hospitality: Tip reporting and pooling, shift scheduling, multiple pay rates, and restaurant POS software integration.
• Retail: Support for multiple locations, seasonal staff, time-off tracking, and quick rehires.
• Professional services: Project-based time tracking, client billing, and integration with accounting tools like QuickBooks.
• Construction: Certified payroll, contractor/employee pay, job site tracking, and prevailing wage compliance

Best overall payroll software for small business

Finding the right payroll software comes down to what your business’s top priorities are. For some, that’s built-in time tracking or scheduling. For others, it’s super comprehensive HR tools.

We’ve broken down the top options to help you choose the right fit for your team.

Note: Pricing is current at the time of writing. Be sure to check each provider’s site for updates.

1. Homebase Payroll

Homebase is built for small to medium businesses that run on hourly work. Think restaurants, retail shops, salons, and home service teams. It brings payroll, time tracking, scheduling, and team communication together into one easy-to-use app.

Best payroll software for: Hourly teams and businesses already using scheduling tools. 

Key features: 

• Comprehensive employee scheduling with built-in labor law compliance (including breaks and overtime alerts).
• Mobile time tracking with geofencing and automatic calculation of hours, PTO, and wages.
• Automated payroll processing with direct deposit, automated tax filings, and digital recordkeeping.
• Tip pooling, distribution, and POS integrations to simplify restaurant and retail payroll.
• Employee-friendly features like pay notifications, early wage access, and 24/7 app access.
• Free setup and support from real payroll specialists.

Starting price: Free basic plan for up to 10 employees + payroll add-on at $39/month + $6 per employee/month.

Free trial: Yes. Payroll is available as an add on.

Why it wins: Homebase eliminates double data entry between scheduling and payroll. Our all-on-one platform lets you hire, schedule, timetrack, and pay your team all in one place, without wasting time or switching between tabs.

Try Homebase today and see why USA Today rated it as the best small business payroll for hourly teams. 

2. Gusto

Best payroll processing software for: Benefits-focused businesses.

Key features: 

• Automated payroll and tax filings with unlimited runs, including contractor payments.
• Support for multiple pay rates, plus domestic and international employee payments.
• Health and retirement benefits administration, PTO tracking, and new hire onboarding.
• Employee access to the Gusto Wallet app for pay tracking and financial tools.
• Integrations with accounting software like QuickBooks, Xero, and FreshBooks.

Starting price: Starting at $49/month plus $6/person/month

Free trial: No.

Why it wins: Gusto offers an exceptionally user-friendly interface with comprehensive HR features for growing businesses and salaried teams without dedicated payroll staff.

3. QuickBooks Payroll

Best payroll software for: Businesses already using QuickBooks accounting for bookkeeping and recording.

Key features: 

• Automated payroll with direct deposit, autopay, and built-in tax calculations and filings.
• Integration with QuickBooks Online and QuickBooks Time for streamlined payroll and time tracking.
• Guided payroll setup and 24/7 expert support.
• Tax penalty protection available with the Elite plan.
• Self-service employee portal.

Starting price: Starting at $53/month plus $4/person/month, with a current 50% discount for 6 months.

Free trial: Yes

Why it wins: QuickBooks Payroll integrates perfectly with QuickBooks accounting software, offering robust reporting capabilities across multiple service tiers.

4. ADP Run

Best payroll processing software for: Established businesses wanting enterprise-level features as they grow.

Key features:

• Full-service payroll with unlimited runs, scheduled cycles, and automatic tax calculations and filings.
• Comprehensive tax management with federal, state, and local compliance guarantees.
• HR integration and document management library.
• Self-service employee portal with mobile access and personal finance tools.
• Expert support available when needed.

Starting price: Contact for a quote

Free trial: No

Why it wins: ADP Run scales with growing businesses, offering customizable reporting, strong compliance features, and implementation support—all built into a user-friendly platform designed for efficient payroll processing.

Best free payroll software for small business

Thinking about how to keep your costs down? Here are a couple of options for cheap payroll software small businesses can use.

Wave Payroll

Best for: Micro businesses with simple payroll needs. Wave Payroll is very affordable for small teams with a simple interface that integrates perfectly with Wave's free accounting software.

Key features: 

• Basic payroll processing with direct deposit.
• Employee and contractor payment options.
• Basic self-service access for employees.

Starting price: $40/month plus $6/person/month on top of free or paid accounting plans.

Limitations: Very basic features and limited integrations.

Homebase (free tier)

Best for: Very small hourly teams. Homebase's free plan offers time tracking and employee scheduling for one location with up to 20 employees.

Key features: 

• Basic scheduling with templates.
• Time tracking that calculates hours, paid and unpaid breaks, and overtime.
• POS integration.

Starting price: Get free automated time tracking and scheduling, and add on payroll for $39/month base fee + $6/month per employee paid.

Upgrade path: Seamlessly transition to paid small business payroll features.

Best payroll service for small business by industry

Here are the best payroll companies for small businesses based on different industries:

Restaurants and food service - Homebase Payroll

Best small business payroll for: Hourly teams with shifting schedules. Homebase’s all-in-one mobile app literally manages all of your business needs in the palm of your hand.

Key features: 

• Handles complex tip pooling and reporting options.
• Integrates with POS systems.
• Manages varying schedules and overtime rules.

Starting price: Get free automated time tracking and scheduling, plus paid add ons for payroll tip management.

Retail businesses - Square Payroll

Best payroll software for: Retail businesses using Square's POS system who need to manage tipped employees or contractors. 

Key features: 

• Easily syncs with Square POS and inventory.
• Handles commission and sales-based pay.
• Manages seasonal staffing fluctuations.

Starting price: $35/month + $6 per employee/month.

Professional services - Gusto

Best payroll service for: Small businesses that require project-based hour tracking.

Key features: 

• Project-based billing integration.
• Comprehensive benefits for attracting talent.
• Time tracking for billable hours.

Starting price: Basic plans start at $49/month + $6 per employee/month.

Best payroll companies for small business: Self-service vs. full-service

Choosing between self-service and full-service payroll depends on how hands-on you want to be—and how much time and budget you’re working with.

Self-service payroll software

When to choose: You want control and cost savings.

Self-service is often the best payroll service for small business owners who prefer to manage hours, run payroll, and handle filings themselves. It’s budget-friendly and offers more oversight if you’re comfortable handling data entry yourself.

Top options include:

• Homebase – Built-in scheduling, time tracking, and tip management.
• Gusto – Intuitive platform with automated tax filing.
• QuickBooks Payroll – Seamless integration with QuickBooks accounting.

Full-service payroll companies

When to choose: You want payroll off your plate.

Full-service payroll handles everything—calculations, tax filings, direct deposit, and compliance—so you can stay focused on running your business instead of payroll tasks.

Top options include:

• ADP – Scalable and compliance-focused.
• Paychex – Personalized service and HR tools.
• Paycom – All-in-one payroll and HR platform.

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How to choose the best payroll system for your small business

Finding software that simplifies payroll for small businesses is about more than shiny features. It’s about finding something that fits how your business operates daily.

Whether you’re managing a small, hourly team or growing into a more complex operation, here’s what to keep in mind:

Step 1: Assess your current pain points

Start by getting honest about what’s causing headaches in your current payroll process.

Here’s a list of common troubles small business owners run into:

• Mistakes on paper timesheets: Manual math causes errors. The right system automates wage calculations, tax deductions, direct deposits, and pay stub generation—taking the guesswork out of payroll.
• Tax deadline or compliance issues: Staying on top of taxes and regulations is tough. Choose software that automatically calculates taxes, files required forms, stays updated with laws, and offers error protection.
• Processing payroll across multiple locations: Managing payroll for different sites gets complex. Cloud-based services support multi-location payroll for easy, centralized management.
• Keeping up with employee questions: Employees often ask about pay stubs, tax forms, or hours. Platforms with employee self-service portals and mobile access empower your team to find answers themselves.
• Too many tools in the kit: Juggling separate payroll, scheduling, and accounting tools slows you down. Look for payroll software that integrates seamlessly with your existing systems to simplify your workflow.

Once you know your challenges, you can focus on finding payroll management software designed to solve them—saving you time, reducing errors, and making payroll a whole lot less stressful.

Step 2: Determine your must-have features

The best payroll for small business is the one that fits how you work. Prioritize features based on your business size, industry, and how hands-on you want to be.

A few important features include:

• Time tracking and employee scheduling.
• Automated tax calculations and filings.
• Direct deposit and contractor payments.
• Employee self-service portals.
• Tip reporting and shift differentials.
• Integrations.
• Mobile apps to help you manage payroll on the go.
• Customer support.
• Timetracking and payroll software that sync.

If there’s one feature we recommend for all small businesses, it would definitely come down to integrations! Look for payroll software that connects seamlessly with your existing tools: accounting software, time tracking, POS systems, and banking solutions.

Good integrations save time and protect you from errors with data entry.

Step 3: Calculate total cost of ownership

Budget matters—but don’t just compare sticker prices. Some payroll processing software charges by employee, others by pay run, and some offer free plans with add-ons, which can be a better fit for growing teams. 

Look at the full picture:

• Monthly subscription fees.
• Per-employee or per-pay-run charges.
• Costs for additional features (e.g., HR tools, tax filing).

Sometimes, paying a little more upfront gets you a lot more in value—and peace of mind. But also make sure you’re not paying for features you’ll never use.

Step 4: Test before you commit

Take advantage of free trials and demos to run a test payroll, explore the employee portal, evaluate the interface, and get a feel for customer support. Hands-on experience is the best way to find software that fits your workflow.

Don't make these common payroll mistakes when choosing software

Choosing the right payroll system for small business isn’t always straightforward—and the wrong fit can cost you.

Here are a few common mistakes to avoid:

• Choosing based on price alone: The cheapest option often lacks key features like automated tax filing, direct deposit, and compliance alerts.
• Ignoring integration capabilities: Payroll should sync with your time tracking, POS, and accounting tools. If it doesn’t, you’ll waste time entering data twice and risk errors.
• Overlooking state-specific compliance: Not all software handles state tax rules or labor laws equally. Make sure your provider supports the states where you operate, plus multistate payroll if you need it.
• Not considering growth and scalability needs: Outgrowing your payroll system creates delays and headaches. Choose software that can scale with your team and business needs.
• Skipping the trial or demo: A hands-on trial shows how the platform really works—and how responsive the support team is when you need help.

Frequently asked questions about payroll for small business

Here are some frequently asked questions about choosing the best payroll service for small business:

What is the best payroll program for small businesses?

The best payroll program for small businesses depends on your needs, but top choices include Gusto for its all-in-one features, Homebase for hourly teams, and QuickBooks Payroll for seamless accounting integration.

What is the easiest way to do payroll for a small business?

The easiest way to do payroll is by using full-service payroll software that automates calculations, tax filings, and direct deposits—so you spend less time on admin and more time running your business.

If full-service payroll isn’t in your budget, Homebase gives you the best of both worlds: automation where it counts (like tax filings and direct deposits), and full visibility into what’s happening—without the cost of outsourcing.

What is the best way to pay employees in a small business?

The best way to pay employees is through direct deposit, which is supported by most modern payroll systems. It’s fast, secure, and preferred by most employees over cash or paper checks.

Can I do my own payroll for free?

Yes, you can do your own payroll for free, either manually or with free software. Going this route means you’ll need to manually calculate hours, taxes, deductions, and stay up to date on changing tax laws. But be cautious—one small mistake can be expensive.

Get started with the right payroll solution for your team

Whether you're managing a few hourly employees or opening new locations across the country, the best payroll for small business is the one that makes your life easier. Customization is your friend, so seek out integration capabilities more than just individual features.

Ready to get started? Test out free trials with 2-3 of your favorite picks. Homebase makes payroll simple for hourly teams—give us a try to see how seamlessly scheduling and payroll can work together.

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