Starting a small business is exciting. But there's a lot to think about and plan. One of the less glamorous tasks for startups is payroll. There are many ways to approach small business payroll.
Payroll goes beyond wages. There are payroll taxes that need to be addressed. Many small business owners look for the best payroll software services available to help them with this somewhat arduous task.
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Setting Up Payroll
Payday is exciting for employees but can be a complication for small business owners. And it all starts with payroll taxes.
First, you'll need an employer identification number (EIN) from the IRS. You'll also need to know what types of employees you have and what forms should be filed.
Two basic types receive different tax forms. These affect your small business payroll. Some receive a W-2 Form and those that receive a 1099 Form. Contractor payments are made using a 1099 Form. Full-time or part-time employee hours or salaries are made with the W-2 Form. You'll be withholding IRS and state taxes from your employees' paychecks.
These payroll taxes include income, Medicare, unemployment, Social Security and various state taxes.
You'll also need to decide if you'll be making a direct deposit of wages into your employee's bank account.
Once you have an idea of what you want, you'll need to determine if you're going to keep your payroll system in-house using payroll software or use payroll providers.
Best Payroll Services Available
If you don't go with a payroll service, you'll need to keep updated on the percentage rates on each withholding tax. You also must be sure to file these taxes and forms on a timely basis. Depending on your payroll amount, it could be quarterly to daily.
A payroll provider can file for you. The best payroll services will work with you or your human resource (HR) department to ensure filings and tax payments are made on time with the correct amount.
There are a lot of payroll services available, but some are at the top of their game, and you might want to consider them.
Gusto Full-Service Payroll
Gusto is an all-encompassing payroll provider. Gusto will run payroll as often as you want regardless of the pay period, and they have unlimited payroll. They automate tax calculations. A direct deposit to pay employees is not a problem with Gusto. And if you have contract workers, they can make contractor payments. Other HR services are available.
For a small business, their pricing is $36 a month plus $6 per person per month.
ADP New Hires and Onboarding
ADP has payroll processing with direct deposit and tax filing. ADP also provides onboarding of new hires. In addition, they can give the employees HR forms and documents. ADP has comprehensive HR support. Garnishment payment services are also provided. ADP makes integrations easy with their mobile app.
Pricing is provided with a free quote based on the number of employees and services.
The best payroll services will work with you or your human resource department to ensure filings and tax payments are made on time with the correct amount.
Paychex Online Software Solutions
Besides providing integrations with your payroll software, Paychex offers employee self-service. This gives your employees controlled access to their information. In addition, they offer their Paychex Flex essentials program for those business owners with nine or fewer employees.
They also offer a cloud-based time and attendance system called Paychex Flex Time. Other payroll plans are available.
Pricing is available with a free quote based on the number of employees and services.
Onpay Integrates with Software
Onpay's ability to integrate with Quickbooks and Xero makes it a seamless payroll provider. They can handle your onboarding needs and provide HR support. It's user-friendly and economical.
Pricing is $36 per month plus $4 per person per month.
Patriot Payroll Service Provider
Patriot offers both accounting software and payroll software. It offers a 30-day free trial of unlimited payroll. And it only takes three simple steps to run payroll. Patriot is mobile-friendly and has accounting software integration. It can handle multiple pay rates and will file year-end payroll taxes for no additional fees.
Pricing for their full-service plan is $37 per month plus $4 per person per month.
Popular Quickbooks Payroll
You can activate payroll with Quickbooks online. They offer many services, including HR support, synced 401(k) plans and more. They'll help you set up your payroll system. Quickbooks payroll integrates with your accounting program. And they have bundle pricing.
Pricing for Quickbooks payroll only is $35 a month plus $4 per person per month.
- Merchant Maverick: Everything You Need to Know about Small Business Payroll
- US News: Best Payroll Software of 2022
- Paychex: Payroll Services and Online Software Solutions
- Quickbooks: Bundle Payroll and Bookkeeping
- Quickbooks: What’s the Difference Between 1099 and a W-2
- Gusto: All-in-One Full Service Payroll with Gusto
- ADP: Fast and Easy Affordable Small Business Payroll
- Onpay: Payroll and HR that Move You in the Right Direction
- Patriot Software: Accounting Payroll Software
- IRS: About For 1099 Miscellaneous Income
- Social Security Administration: Employer W-2 Filing Instructions
- IRS: Apply for an Employer Identification Number Online