9 Min. Read

Best Desktop Payroll Software for Small Business

October 10, 2024

For small businesses, the ability to maintain administrative responsibilities can make or break success. Back office obligations include human resources, accounting, payroll, and other critical areas that affect employees and staff members.

In particular, payroll is one area that businesses must prioritize to keep operations running smoothly. Fortunately, automated payroll software options can alleviate some of the stress, confusion, and time commitment involved in the traditional payroll process.

In this guide, learn how full service payroll software can transform your business workflow. We’ll also share five payroll software recommendations to help you get started.

Here’s What We’ll Cover:

What Does Payroll Software Do?

Advantages to Using Payroll Software

Top Payroll Software Recommendations

Qualities to Look for in Payroll Software

Common Payroll Mistakes to Avoid

How Can Payroll Transform Your Small Business?

Key Takeaways

More Payroll Resources for Small Businesses

What Does Payroll Software Do?

Before you pursue the best payroll software, you should first have a thorough understanding of what these services are capable of. Payroll software replaces processes that often involve data entry, time cards, paper checks, and manual bookkeeping.

Manual payroll services can also be time consuming and burdensome. An outdated payroll method tends to drain administrative resources and can contribute to unnecessary or costly payroll errors.

Instead of relying on manual data entry and processing, payroll software:

Maintains a detailed record of active employees
Automatically calculates wages based on hours or overtime worked
Calculates and files payroll taxes
Provides timely and accurate checks to all employees

To remain competitive, attract the best talent, and adhere to industry standards, it’s wise to incorporate an automated payroll software service that aligns with your staffing needs and long-term business goals.

Advantages to Using Payroll Software

If payroll processes are a hassle for your small business, you’re not alone. Up to 54% of employers see room for improvement when it comes to payroll policies and compensation processes.

Unfortunately, the ramifications of bad payroll policies aren’t just felt at the top levels of an organization. Employees who spot mistakes, don’t receive pay on time, or disagree with their employer’s handling of the payroll system may choose to look elsewhere for opportunities.

When you choose a full service payroll platform, your organization benefits from plenty of advantages that can create positive ripples throughout the entire business.

A boost to employee morale when paychecks are correct and delivered on time
A greater understanding of how payroll mistakes cost money and time
Improved brand image and reputation through trustworthy employee relations
Better insight into reporting, compliance, and financial analysis

Top Payroll Software Recommendations

There are several powerful, effective, and intuitive payroll platforms on the market. If you’re unsure how to select the best payroll software for your particular needs we’ve narrowed down the options to five top picks.

1. Gusto

Previously known as ZenPayroll, Gusto is a payroll software for small businesses that uses smart, intuitive features to simplify the entire process from start to finish. Gusto is focused on automated, time-saving, and practical features that benefit both a company and its employees.

With Gusto, payroll managers can:

Automatically sync an entire team’s work hours
Leverage a user-friendly dashboard to run payroll automatically and view important reports
Calculate and automatically file payroll taxes with the appropriate government authorities
Integrate Gusto with other business and HR-related systems or apps
Maintain compliance for hourly workers subject to overtime pay
Tie up loose ends or signatures on important tax documents

If you’re new to full service payroll, choosing a system with built-in reminders and functionality shortens the learning curve and places priority on the tasks and activities that matter most. For this reason, complete payroll service like Gusto is the perfect option for transferring or updating an existing payroll system.

2. OnPay

OnPay is a highly rated payroll software choice that was honored with an Editor’s Choice award from PC Mag. Small business owners prefer the user-friendly features, error-free guarantee, and mobile compatibility. These characteristics make OnPay a smart and flexible option for small businesses that are just getting started.

Additionally, OnPay is a budget-friendly choice for new and growing businesses. The pricing structure is easy to understand and begins at a base rate of $36/month, plus $4 per person each month.

OnPay promises no hidden fees to get started, the ability to transfer existing payroll data, and the opportunity to process payroll across multiple states and locales.

3. Paychex

Paychex is a complete payroll and human resources platform for small and large businesses. The comprehensive features make it easy to switch between basic business needs and benefit from full compliance monitoring.

Paychex specifically caters to small business owners with several features to manage, pay, and communicate with employees. These intuitive features include:

Smart payroll setup and helpful customer support
Configurable dashboards for easy payroll processing
New-hire reporting to onboard staff members and update employee records
Options for payments, including direct deposit and the ability to print checks
Detailed reporting and analytics features

The best payroll options are often those that allow for adaptations as a business expands. Paychex ensures the same thorough support at every level.

4. SurePayroll

Some decision makers prefer a payroll system that caters exclusively to small business operations, rather than to larger companies. SurePayroll, a Paychex subsidiary, is a service that does just that.

SurePayroll is an option for those who want to run online payroll independently and efficiently. Although live customer support is available as needed, the service is built to be flexible, automatic, and mobile compatible.

Additionally, SurePayroll is a program that helps individuals pay household staff, such as childcare providers and other caregivers. By offering these benefits, the platform ensures that each user is compliant when it comes to taxes and government regulations.

5. RUN Powered by ADP

RUN Powered by ADP is a comprehensive and affordable solution that allows businesses to reclaim valuable time and resources. The service is known for improving back-office tasks that otherwise slow down systems and create workplace bottlenecks.

This payroll software is trusted by over 700,000 small businesses in the United States. Its reputation, technology, level of support, and integration to other services and platforms makes it a top contender. Additionally, ADP offers several packages to help small businesses find the exact solution to meet unique payroll, tax filing, and budgeting needs.

RUN occasionally offers a 3-month promotional deal to allow small businesses the chance to experience the platform without charge for a limited time. This opportunity is perfect if you want to test drive a payroll solution before making a longer commitment.

Qualities to Look for in Payroll Software

In today’s financial marketplace, payroll software ranges in complexity, yet many platforms share common characteristics that benefit companies and employees alike.

As you search for the best payroll software for a particular budget and business model, consider the following guidelines.

Ability to transfer and migrate data from a previous system
User-friendly features that allow for fast training and learning
Ability to calculate and file taxes on time to government agencies
Foolproof methods for catching payroll errors ahead of time
Security and compliance features to protect employee data
Mobile compatibility for payroll processing on-the-go
Customer service options for troubleshooting
Transparent and understandable pricing structure

Common Payroll Mistakes to Avoid

Although payroll software can save an enormous amount of time and frustration, a smart and well-informed payroll strategy is essential. Small businesses should pay close attention to the entire payroll process to avoid complaints from employees and to prevent costly errors.

Don’t fall into a payroll processing trap. Educate your team on these common errors and how to avoid them.

Ignoring the Need for Payroll Software

Occasionally, businesses want to save money by maintaining the payroll process in-house, and by refusing to outsource to another service provider. Eventually, this option prevents the ability to scale and meet changing payroll demands.

Implementing payroll software early encourages room for growth and development. Plus, there’s less frustration later when an organization has to migrate to new payroll software.

Submitting Payroll Taxes Late

Every employer is liable to local, state, and federal payroll taxes. The specific amounts and tax rates depend on geographic location. While it’s one thing to calculate the amount of payroll taxes you owe, filing them with the corresponding government entity (most notable the IRS) is an additional step in the process.

If you don’t use a payroll platform, you must file payroll tax manually. Late or missed tax filing can result in steep fees and penalties, which may affect a company’s good standing.

Civil penalties to the IRS amount to billions of dollars each year. For small businesses, these amounts are crippling. Avoid tax filing errors by maintaining knowledge of payroll filing practices and important deadlines.

Failing to Maintain Records

Compliance with government regulations depends on accurate employee record keeping. This includes staying up to date with employment and IRS forms such as:

Form W-4, Employee’s Withholding Certificate
Form W-2, Wage and Tax Statement
Form W-3 (summarizes information from W-2s)
Form 1099, Miscellaneous Income

While part of this compliance is a shared responsibility with employees, the hiring entity should always maintain appropriate records. In most payroll platforms, companies can see, request, and maintain these records in a streamlined manner.

Failing to Fix Mistakes Quickly

Mistakes in payroll are bound to happen. How quickly a business responds to them can have a significant impact on the final outcome. In order to stay compliant and reputable, fix payroll errors whenever you recognize them.

If you use an automated system, set up triggers or automatic reminders to flag any payment or compliance errors at an early stage in the process.

How Can Payroll Transform Your Small Business?

Payroll software can help small businesses tackle the payroll process at all three stages. This includes:

Pre-payroll: Strategy and policy refinement, data analysis, and input validation
Actual payroll process: Calculations and distribution to employees
Post-payroll: Statutory compliance, accounting procedures, and payout

Provide your team with the tools and skills needed to run this critical process without frustration, time delays, or compliance errors.

Key Takeaways

No matter how you choose to manage it, the payroll process is one that small businesses can’t ignore. Employees deserve timely compensation, and government authorities expect accurate accounting and tax filing.

Although free payroll services are enticing, small business owners should consider full service and cloud-based options in order to modernize.

With the right small business payroll software, you can save time, resources, and hassle.