Finding software can be overwhelming. Software Advice has helped thousands of businesses choose the right payroll service to help them manage payroll runs, tax filing, and compliance efficiently.

Showing 1-20 of 23 products

BambooHR

BambooHR is a cloud-based human resources (HR) software service for small and midsize businesses. BambooHR offers small and growing companies a human resource information system (HRIS) that includes an applicant tracking system (ATS)... Read more

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Recent recommendations: 69 recommendations

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Kronos Workforce Ready

Workforce Ready by Kronos is a human resources (HR) platform that combines workforce management with human capital management (HCM) capabilities and is suitable for businesses of all sizes.  Kronos Workforce Ready is a single cloud-based... Read more

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Recent recommendations: 63 recommendations

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APS

APS has a mission: to make payroll and HR easier. They have been providing payroll and tax compliance services to companies since 1996. In 2004, APS released its cloud-based solution for workforce management. APS delivers a single-system... Read more

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Recent recommendations: 38 recommendations

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Viventium

Viventium is a cloud-based payroll and human resources (HR) solution for small to mid-size businesses. Key features include payroll, HR, talent acquisition, ACA tracking, business intelligence, and time and attendance. A mobile Employee... Read more

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Recent recommendations: 21 recommendations

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Deployments: Cloud
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Justworks

Justworks makes it easier to start, run, and grow a business. With Justworks, entrepreneurs and their teams get access to big-company benefits, automated payroll, compliance support, and HR tools - all in one place. Justworks was... Read more

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Recent recommendations: 13 recommendations

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Deployments: Cloud
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Applicant Starter

Applicant Starter is a cloud-based applicant tracking system (ATS) that offers personnel tracking, social sharing and communication management within a suite. The solution also allows users to connect with applicants over text messages,... Read more

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Recent recommendations: 13 recommendations

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EPAY Systems Time & Labor

EPAY Systems Time & Labor is a time and labor management system created to conform to the unique labor needs, compliance requirements and working environments of any organization. As a cloud-based system, EPAY Systems Time & Labor... Read more

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Recent recommendations: 1 recommendations

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iManage by Corporate Business Solutions

iManage by Corporate Business Solutions is a cloud-based HR solution that caters to midsize and large businesses and helps them to manage their HR practices payroll processing routines. It helps managers handle the labor-intensive... Read more

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Recent recommendations: 1 recommendations

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Evolve HCM

Evolve HCM is a SaaS human resource and payroll solution for small to medium-sized cannabis employers. Our product is a fully integrated, fully mobile enabled, full suite human resources application which includes: Recruitment, Onboarding,... Read more

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Recent recommendations: 1 recommendations

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Deployments: Cloud
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NetSuite SuitePeople

NetSuite SuitePeople is a cloud-based human capital management solution, which assists small to large businesses with employee acquisition and onboarding. Key features include payroll, workflow automation, time tracking, feedback collection,... Read more

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Recent recommendations: 17 recommendations

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Deltek Vision

Deltek Vision is a cloud-based project-based solution for professional services firms that is available for cloud or on-premise deployment. It combines project accounting, resource management, project management, time/expense management... Read more

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Employee Navigator

Employee Navigator is an all-in-one cloud-based benefits administration and HR management solution designed to provide benefits and HR management for companies of all sizes. Working with insurance brokers and carriers, Employee Navigator... Read more

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ADP Comprehensive Services

ADP Comprehensive Services is a cloud-based human resource, benefits and payroll administration solution that helps manage the entire workforce and improve operational efficiency across the organization. Designed for all business sizes,... Read more

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Everee

Everee is a cloud-based payroll management and time-tracking software solution that is designed to streamline and simplify the payroll process. With Everee's mobile app, managers can quickly approve timesheets and run payroll from... Read more

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Compport

Compport is a cloud-based human resource management solution designed to help organizations of all sizes handle employee compensation, feedback, surveys and more. The platform blends excellence with efficiency when it comes to automating... Read more

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SilkRoad Onboarding

SilkRoad offers a cloud-based human resource solution capable of handling entire employee lifecycle from recruiting to onboarding and learning and talent management. SilkRoad HRMS is designed to manage entire employee data from a single... Read more

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Arcoro HR

The Arcoro human resources (HR) management solution is the bridge to better HR. Arcoro combines proven, modular HR software designed to help high compliance and high consequence companies improve efficiencies, limit risk and build... Read more

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SWARMHR

SWARMHR is a cloud-based workforce automation solution used by IT consulting companies, non-profits, educational institutes, and insurance companies. It helps small to medium sized enterprises automate HR, accounting, and ATS processes... Read more

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Mirro

Mirro helps leaders better understand their teams and let colleagues grow alongside each other, building positive and ever-evolving team journeys. The platform comes with an activity feed, which allows users to view project updates... Read more

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HRx

HRx is a comprehensive solution built to simplify HR management by automating processes, engaging employees, and remaining compliant. This solution combines hiring, onboarding, time and attendance, benefits, payroll, and more. HRx... Read more

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Buyers guide


Last Updated: April 1, 2020

Payroll compliance is complex, especially for small and midsize businesses (SMBs). There are many things to consider:

  • Determine net pay by factoring in employee leave and time worked
  • Calculate state and federal taxes to remain in compliance
  • Ensure taxes are filed on time—the failure of which can mean facing Internal Revenue Service (IRS) fines

According to Inc.com, about 40% of SMBs incur IRS penalties, costing them an average of $850 per year. A payroll service can help you manage payroll compliance more efficiently, thereby helping you avoid these fines. The service also saves time spent with payroll processing and ensures that all your employees receive their paycheck on time.

However, because of the sheer number of payroll providers, finding the right service for your business can be confusing. That's why we've created this guide with all the necessary information you'll need for selecting the best payroll service for your business.

In this guide, we'll cover:

What is a payroll service?

Payroll services allow businesses to outsource their payroll management processes. Such services help businesses track employee time and attendance, calculate salaries, compute taxes, and remit salaries to employee bank accounts. Some services also perform tax filing on behalf of your business.

Common offerings of payroll service

The first step towards selecting the right payroll service for your business is to understand what is offered with this type of service. According to our research, the following are the features you should be aware of:

Payroll run

Calculates net pay and delivers salaries to individual employee bank accounts on the designated date.

Compliance management

Ensures that the business' payroll practices adhere to compliance standards, such as the Labor Welfare Fund (LWF), Employee State Insurance (ESI), Professional Tax (PT), and Provident Fund (PF).

Tax management

Calculates local taxes, state taxes, and federal taxes applicable to employee payroll. Some services also file taxes on behalf of your business.

Time tracking

Records employee time worked to calculate the salaries based on hourly wages. This functionality also helps payroll service providers to manage labor and overtime pay compliance.

Employee self-service

Provides your employees with an online portal or mobile app where they can access their payroll information.

W-2 and 1099 support

Generates W-2 and 1099 forms using the payroll data.

Reporting

Provides you with reports on different metrics such as employee payroll, payroll costs, and taxes.

What type of client are you?

The next step is to understand the types of clients that use payroll services. This knowledge will help you select a product based on your business requirements.

The following are different types of clients of which to be aware:

  • Integrated HR solution buyers. A lot of payroll services are offered with HR software. Using services from your HR software vendor allows you to manage HR functions (such as recruiting, onboarding, and performance management) along with the payroll process, all from a single system. If you are a small business that needs HR software that also offers payroll services, there are many options to look at in the market.
  • Standalone payroll service clients. Standalone payroll services help you automate the payroll function of your business without any additional functionality. Small businesses that have complex payroll compliance needs or are fine with keeping payroll and HR management process separate can invest in these services.

Benefits and potential issues

After you've learned about the common features, the next step is to understand the advantages of using a payroll service. Knowledge of benefits will help you assess the usefulness of a payroll service for your business, which will help you build a strong case for the investment.

Here are the key benefits of payroll services:

  • Faster payroll processing. Since payroll services manage payroll calculations and tax deductions, they are able to remit salaries faster. According to our research, most payroll services can process employee salaries in less than four days.
  • Easier compliance tracking. Payroll service providers keep a close watch on tax, payroll, and labor compliance. They ensure that the payroll taxes are accurately calculated, overtime pay is factored into payroll calculations, and employee pay and benefits are in compliance with government regulations.

  • Increased business profits. Using a payroll service helps you avoid possible costly IRS fines, thereby contributing to your business profits. Outsourcing the payroll process can also help you minimize or completely eliminate your payroll staff, resulting in reduced costs.

However, despite these benefits, there are some potential issues that you need to factor in while selecting a payroll service:

  • Data security concerns. With the use of any third-party service, there is a risk of data security. In fact, Helen Poitevin, VP Analyst HCM at Gartner, points out third-party services as one of the biggest threats surrounding employee data security. Businesses need to thoroughly examine data security practices followed by the payroll service provider before making any final decisions.
  • Loss of control. When you outsource your payroll process to a third-party service provider, you risk losing visibility and control of the payroll process. You have to rely on what the service provider tells you. For this reason, thoroughly assess the payroll management practices followed by the payroll service provider before you make the investment decision.

Market trends to understand

The landscape of payroll services is changing fast. As a result, to ensure long-term success with your payroll service provider, you need to select services that are incorporating the recent market trends into their offerings.

Here are the key market trends that you should know about for payroll services:

  • Adoption of employee self-service portals are on the rise. Employee portals allow employees to view their salary components and benefits, as well as have access to their pay slips. As businesses look for ways to automate their payroll function completely, they are more open to outsourcing employee self-service to these third-party services. We expect this feature to become a core payroll service offering in the near future.
  • Global payroll support to become standard payroll services function. As more companies expand their presence into multiple countries, an increasing number of payroll services are adding global payroll support into their offering. In addition to the features of one-country payroll services, a global payroll service also includes multicurrency and region specific compliance management.