Guide To Payroll Software Costs

Payroll software costs vary by provider, business size, features, and add-ons. Learn what affects payroll pricing and how much you can expect to pay.

WRITTEN & RESEARCHED BY
Erica Seppala
Editor & Senior Staff Writer

Last updated onUpdated May 23, 2026

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Key Takeaways

Payroll software usually costs a monthly base fee plus a per-employee fee.
Employee count, payroll features, add-ons, and tax support can all affect total payroll software costs.
Businesses can lower payroll costs by choosing only the features they need and comparing lower-cost payroll providers.

Payroll software costs vary by provider, plan, business size, and feature needs. In general, small businesses can expect to pay around $44/month plus $6/employee per month for payroll software with essential payroll features.

This guide breaks down payroll software pricing, including average costs, common pricing models, and the biggest factors that can affect how much your business pays.

Table of Contents

How Much Does Payroll Software Cost?
What Factors Impact Payroll Software Pricing?
How To Lower Payroll Costs
The Bottom Line On Payroll Software Costs

How Much Does Payroll Software Cost?

Payroll Software	Payroll Software Pricing
OnPay	$49/month + $6/month per person
Patriot Payroll	$17/month +$4/month per person - $37/month + $5/month per person
QuickBooks Workforce	$50/month + $6.50/per person - $203/month + $10/per person
Roll by ADP	$39/month + $5 per employee
Paychex	$39/month + $5/employee or custom pricing
Justworks	$50/month + $8/month per person - $109/month per employee
Wave Payroll	$40/month + $6/employee
Square Payroll	$6/contractor or $35/month + $6/per employee
Homebase	up to $120/month per location

The average payroll software costs $43.90/month + $6/employee per month.

To calculate this average, we evaluated popular payroll software providers that include three essential payroll features:

Support for paying employees and contractors
Direct deposit and paper check payment options
Full-service federal, state, and local payroll tax support

This average does not represent the lowest possible payroll software pricing. Instead, it reflects what small businesses can generally expect to pay for essential payroll services from top payroll software providers.

We did not include free payroll software in this average because free plans often lack full payroll tax support and would artificially lower the pricing estimate.

What Factors Impact Payroll Software Pricing?

Payroll software pricing is mostly affected by two things: business size and features/add-ons. In general, the more employees you pay and the more payroll or HR features you need, the more you’ll spend.

Business Size

Most payroll software providers charge a monthly base fee plus a per-employee or per-person fee. That means costs increase as your team grows.

Some providers also separate plans by business size or complexity. For example, a business with a few employees may only need basic payroll, while a larger business may need multistate payroll, HR tools, benefits administration, time tracking, or more advanced reporting.

Features & Add-On Services

Payroll software costs also depend on which features are included in the plan and which cost extra.

Common payroll add-ons include time tracking, benefits administration, workers’ compensation, multistate payroll, HR support, onboarding tools, and advanced reporting. Add-ons can help businesses build a package around their needs, but they can also raise the total monthly cost.

For example, one provider may include multistate payroll or time tracking in a higher-tier plan, while another may charge separately for those tools. The best value depends on which features your business actually needs.

How To Lower Payroll Costs

You can lower payroll software costs by choosing a plan that matches your actual needs, avoiding unnecessary add-ons, and reducing payroll mistakes that may lead to fees or penalties.

To keep costs down, compare providers and look for:

Transparent monthly pricing
Included payroll tax support
No long-term contract requirements
Free setup or migration support
Included features you’ll actually use
Add-ons you can skip or remove

If your current payroll software is too expensive, compare cheaper payroll software options to find a provider that still covers the essentials without charging for tools your business doesn’t need.

The Bottom Line On Payroll Software Costs

Payroll software costs vary widely, but most small businesses should expect to pay a monthly base fee plus a per-employee fee. Costs can also rise quickly if you need add-ons such as time tracking, benefits administration, HR support, multistate payroll, or advanced reporting.

If your current payroll software is getting too expensive, compare lower-cost payroll software options before switching to free or DIY payroll. Free payroll tools can work for very small businesses, but they often come with limited payroll tax support, fewer features, and more manual work.

DIY payroll is also an option, but it comes with more risk. Before calculating payroll on your own, make sure you understand the time commitment, tax deadlines, and potential cost of payroll mistakes.

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Erica Seppala

Editor & Senior Staff Writer at Merchant Maverick

Erica has been writing about small business finance and technology since 2008. She joined Merchant Maverick in 2018 and specializes in researching and reviewing business software, financial products, and other topics to help small businesses manage and grow their operations. Her expertise has been cited in MSN, Reader's Digest, Vox, U.S. News & World Report, and Real Simple. She is a Certified ProAdvisor for QuickBooks Online and QuickBooks Payroll, a graduate of Limestone University, and currently resides in Greenville, South Carolina.

View Erica Seppala's professional experience on LinkedIn.