Payroll Service Cost 2026: What Small Businesses Actually Pay

Independent pricing data. No vendor bias. Enter your employee count for an instant estimate.

How many employees?

Estimated monthly cost

$89 - $149/mo

Gusto

$49 + $6/emp

$109/mo

QuickBooks

$50 + $6.5/emp

$115/mo

Paychex

$39 + $5/emp

$89/mo

OnPay

$49 + $6/emp

$109/mo

Rippling

$35 + $8/emp

$115/mo

ADP

$79 + $7/emp

$149/mo

Monthly Cost at a Glance

What businesses typically pay across budget, mid-tier, premium, and enterprise providers.

Employees	Budget	Mid-Tier	Premium	Enterprise
5	$55 - $75	$75 - $110	$110 - $165	$150 - $250
10	$75 - $110	$105 - $160	$160 - $250	$250 - $400
25	$130 - $200	$200 - $310	$310 - $470	$450 - $700
50	$230 - $340	$340 - $530	$530 - $830	$800 - $1,250
100	$420 - $620	$620 - $960	$960 - $1,500	$1,400 - $2,200

All figures are monthly estimates in USD. Actual costs vary by provider and features selected.

What Drives Payroll Service Cost

Number of Employees

The per-employee fee is the dominant cost variable. At $6/employee/month, the difference between 5 and 50 employees is $270/month. If you plan to grow, prioritize providers with lower per-employee rates even if their base fee is slightly higher.

Cost by company size →

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Features You Need

Basic payroll-only services start around $35/month. Adding automatic tax filing, HR tools, time tracking, benefits administration, and dedicated support pushes costs to $80 to $150/month base. Only pay for features your business actually uses today.

Features by tier →

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Pay Frequency

Providers that charge per payroll run cost significantly more with weekly pay. Switching from weekly to biweekly saves 26 runs per year. At $5/employee/run with 20 employees, that is $2,600/year in savings from frequency alone.

Pay frequency impact →

Common Payroll Cost Mistakes

Choosing on base fee alone

A $35 base fee with $8/employee costs more than a $49 base with $5/employee once you pass 5 employees. Always calculate your total monthly cost, not just the headline price.

Paying for unused features

Premium tiers include benefits admin, HR compliance tools, and API access. If you have 5 employees and no benefits to manage, the basic tier at half the price does the same job.

Ignoring hidden fees

Off-cycle runs, W-2 processing, state registrations, and annual price hikes can add $500 to $2,000/year. See all 9 hidden fees →

Not accounting for DIY time cost

DIY payroll takes 2 to 4 hours per run. At $50/hour with biweekly payroll, that is $2,600 to $5,200/year in time alone, often more than a full-service provider. See the full comparison →

Calculate Your Total Payroll Cost

Include hidden fees, time costs, and compare all 6 providers side by side with our comprehensive calculator.

Open Total Cost Calculator

Frequently Asked Questions

How much does payroll cost per month?

Most payroll services charge a base fee of $35 to $80 per month plus $5 to $8 per employee per month. A 10-employee business using a mid-tier provider typically pays $86 to $180 per month. Budget options start around $55/month for 5 employees, while premium services with HR tools, benefits admin, and dedicated support can run $150+ per month before the per-employee add-on.

What is included in a basic payroll service?

A basic payroll service includes payroll calculation, direct deposit, federal and state tax calculation, and year-end W-2/1099 preparation. Most basic plans also include employee self-service portals and new hire reporting. HR tools, time tracking, benefits administration, and automatic tax filing typically require a higher-tier plan or paid add-ons.

Is it cheaper to do payroll yourself?

For 1-3 employees, DIY payroll software costs $0 to $30/month versus $50 to $80 for a full-service provider. However, the real cost of DIY includes your time (2 to 4 hours per payroll run), risk of IRS penalties averaging $845 per incident, and the burden of staying current with changing tax rules. Most businesses break even on outsourcing at 3 to 5 employees.

What hidden fees do payroll services charge?

Common hidden fees include W-2/1099 processing ($3 to $7 per form), off-cycle payroll runs ($15 to $50 each), state tax registration ($20 to $50 per state), year-end tax forms, implementation/setup fees ($50 to $200), and annual price increases of 5 to 10%. These can add $500 to $2,000 per year beyond the advertised price.

Which payroll service is cheapest?

Rippling has the lowest base fee at $35/month but charges $8 per employee, making it cheapest for very small teams (under 8 employees). Paychex at $39 base plus $5 per employee is cheapest for mid-size teams (10-50 employees). The cheapest option depends on your employee count because the per-employee fee matters more than the base fee as you scale.

Can I switch payroll providers mid-year?

Yes, you can switch at any time, though January 1 is cleanest because there is no year-to-date data to transfer. Switching mid-year requires migrating YTD earnings, tax withholdings, and deposit history. Budget 2 to 4 weeks for the transition, and run one parallel payroll cycle before fully switching to catch any data issues.

What is a PEO and how is it different from payroll service?

A Professional Employer Organization (PEO) is a co-employment arrangement where the PEO handles payroll, benefits, HR compliance, and workers' comp as your employer of record. PEOs cost 2 to 12% of total payroll or $80 to $200+ per employee per month, significantly more than a standard payroll service ($5 to $8/employee/month). PEOs make sense for companies with 25-150 employees that want Fortune 500-level benefits access.

Do payroll services handle tax filing?

Most mid-tier and full-service payroll providers handle federal and state tax filing, tax deposits, and year-end form preparation (W-2s, 1099s) as part of the subscription. Basic-tier plans often calculate taxes but require you to file and deposit yourself. Always confirm whether tax filing is included or an add-on before signing up.