6 of the best payroll services for small businesses

For small business owners and managers, accurate payroll processing is second to none. It ensures your staff is compensated on time, keeps your company compliant with legal standards, and prevents costly penalties. It also plays a vital role in building and maintaining employee satisfaction and trust. 

But it’s not without its challenges, from understanding complex tax regulations and managing diverse employee benefits to navigating the intricacies of compensation structures for different types of employees.

Enlisting the help of payroll software or a third-party payroll provider simplifies the process, offering tools and expertise that help manage payroll tasks efficiently, reduce the risk of errors, and adapt to your business's evolving needs.

In this guide, we'll explore six of the best payroll services for small businesses in detail and highlight the pros and cons of each.

What is payroll software?

​​In short, payroll software streamlines the process of paying employee salaries and wages. It automates various payroll tasks such as calculating employee salaries, deducting taxes, and managing employee data, significantly reducing the chance of errors and saving valuable administrative time.

Choosing a solution that aligns with your organization's needs requires understanding in detail how payroll software works, as they perform a range of functions:

• Calculate wages: The software automatically computes each employee's pay by factoring in hours worked, hourly rates, overtime, and salary structures.
• Deduct taxes: It manages tax deductions for federal, state, and local compliance, minimizing the risk of penalties.
• Process payments: Payments are disbursed to employees, typically through direct deposit, although some systems also support other methods like checks.
• Generate reports and tax forms: The system produces detailed payroll reports for managerial oversight and prepares essential tax documents, such as W-2s and 1099s.
• Provide self-service access: Employees can access their pay stubs, tax documents, and other payroll information through a self-service portal, reducing the workload on HR staff.

How to choose a payroll provider for small businesses

The system you select will determine how efficiently payroll gets processed, how well you comply with regulations, and how satisfied employees are with the process. Here are the key factors to ensure your choice meets your business's and employees’ needs:

Mastering the essentials

Your system should automate all complex tasks, such as tax calculations, and offer detailed reports. Automation will save time and reduce errors, making your payroll process more efficient overall.

Payment methods

Employees have varying preferences for receiving their pay, so your payroll software should support multiple payment methods. Options should include direct deposit, paper checks, and capabilities for handling international payments.

Currency support

For businesses operating internationally, payroll systems need to be capable of managing payments across multiple currencies and complying with the tax laws and regulations specific to each country. This ensures accurate and lawful compensation for employees, regardless of their location.

Compliance

Tax laws across different states and countries may change over time. Your software must keep up with these changes to protect you from financial or legal penalties.

Integration with other systems

By choosing payroll software that easily integrates with your existing accounting, HR, or enterprise resource planning software, you'll streamline processes and reduce the need for manual data entry. Ideally, information should flow automatically and securely between these related systems.

Customer support

Access to reliable support for your payroll software helps quickly resolve any issues, such as delayed payments, inaccurate tax deductions, or data synchronization errors between systems, which can significantly harm team morale and undermine employee trust.

Scalability

As your business grows, your payroll system should be able to grow with it. Switching systems can be costly, involving not just the direct expenses of new software licenses, but also integration costs with your existing systems and the time needed to train staff on new software.  

Best payroll solutions for small businesses

When selecting a payroll provider for your small business, think about your specific needs, such as tax management and software integration capabilities. Also, consider factors like security, dependable customer support, and an appropriate pricing structure. 

Here are six of the most popular options for payroll services:

1. Oyster

Oyster's global employment platform enables small businesses to handle payroll compliantly across over 180 countries. Supporting more than 140 currencies, it provides a comprehensive toolkit for compliance, payroll management, and talent acquisition without needing to establish a local entity in each country. This makes it particularly advantageous for businesses looking to expand globally with minimal legal and administrative overhead.

2. Gusto

Gusto's feature-rich platform offers payroll, benefits administration, and compliance management all in one. It supports a range of payment methods, including direct deposit and paper checks. Gusto automates tax calculations, filings, and payments, and provides employee self-service portals for accessing pay stubs and tax documents.

3. OnPay

OnPay is effective for small business payroll for straightforward, no-frills payroll processing in the United States. It handles tax filings, payroll processing, and benefits management nationwide. Its simplicity and flat-rate pricing make it ideal for small businesses with stable employee counts that don't expect to scale rapidly.

4. Paychex

Paychex offers tailored solutions for small and medium-sized businesses, including payroll services, benefits management, and compliance assistance. It's known for its scalable options, making it an excellent choice for companies anticipating growth.

5. SurePayroll

Designed specifically for small businesses, SurePayroll caters to both traditional employees and independent contractors. It automates tax filing and payments, including local, state, and federal taxes.

6. Rippling

Rippling integrates payroll with HR and IT, making it a powerful tool for businesses that also need to manage their IT infrastructure alongside human resources. Its ability to handle global payroll makes it ideal for companies with an international workforce.

An effortless payroll tool for your team 

Building the best team, no matter how big or small, starts with finding the ideal candidates. Retaining that top talent means making sure they get paid accurately and on time. Oyster’s Global Payroll solution allows you to pay staff members and contractors in 140+ currencies and 180+ countries without the hassle of invoices and reimbursements. The user-friendly platform provides compliant payroll management and insightful reports, easing your administrative burden and ensuring adherence to local regulations around the world.

Discover how Oyster can help you hire, reward, and retain top international talent and revolutionize your approach to building a globally diverse team.

About Oyster‍

Oyster is a global employment platform designed to enable visionary HR leaders to find, engage, pay, manage, develop, and take care of a thriving distributed workforce. Oyster lets growing companies give valued international team members the experience they deserve, without the usual headaches and expense.

Oyster enables hiring anywhere in the world—with reliable, compliant payroll, and great local benefits and perks.