Top 10 HR Platforms for Small Businesses & Startups 2025
The setup is quick, the pricing is transparent, and the support is responsive. While it doesn’t offer as many HR bells and whistles as platforms like Gusto or Rippling, it delivers reliable payroll processing at a fraction of the cost. For early-stage startups that just want to get payroll right without overpaying, Patriot Payroll offers excellent value. Startups that are preparing for rapid growth or hiring in multiple states will appreciate ADP’s focus on compliance. The platform helps you navigate labor laws, tax regulations, and reporting requirements, which can be overwhelming for first-time founders.
So there is a tangible benefit to startups that use an outside broker over the benefits options offered by the payroll company. PEOs, or “professional employer organizations” may make sense for many companies. In particular, they can be great for companies hiring talent in multiple states/jurisdictions, taking care of payroll taxes, benefits negotiation and maintenance and other HR busy work. On the cons side, they can be more expensive and offer lower flexibility on benefit choices. If you do find yourself facing a payroll tax error, the first move is to reach out to your accounting firm or accountant. Fixing the problem can be complex depending on the states involved and the IRS regulations.
- With advanced automation and workflow customization, Rippling suits startups that anticipate fast growth and want to minimize manual admin as they scale across states or even globally.
- On the cons side, they can be more expensive and offer lower flexibility on benefit choices.
- ADP is one of the largest and longest-running HR and payroll companies in the world.
- This is how software companies make money, but as a user it feels discouraging.
Best practices for setting up small business payroll
Between calculating taxes, tracking hours, managing benefits, and ensuring compliance with ever-changing regulations, payroll management can quickly become a full-time job in itself. If you’re a startup that’s already using QuickBooks accounting software, Quickbooks Online Payroll might be the ideal option for you. All plans, whether you choose Core, Premium, or Elite, include full-service payroll (includes automated taxes and forms), auto payroll, health benefits for your team, 401(k) plans, and 1099 e-file & pay. Gusto, which used to be ZenPayroll, was founded in 2011 and is widely known for being an affordable payroll and benefits management software for startups and other small businesses.
Compliance done right
In this guide, we’ll help you make sense of your options by walking you through the best payroll services designed specifically for startups. Whether you’re just setting up payroll or managing pay runs for an expanding team, we’ve got you covered. Payroll software costs vary depending on the features, number of employees, and level of service. Basic payroll software may cost $20-$100 per month, often with additional per-employee fees. With ADP, startup owners can automatically track and file taxes, create automated direct deposits, easily access state and federal forms and resources, and set up detailed, automated reporting.
Revolut Payroll simplifies salary management for startups with its user-friendly platform. Enjoy a quick setup, add team members effortlessly, and customise pay schedules without dealing with spreadsheets. The all-in-one solution allows seamless payroll processing directly from your Revolut Business account, eliminating the need for additional software. Rippling’s Full-Service Payroll Software is a game-changer for UK startups, offering swift payroll processing in just 3 minutes.
Gusto: Best for Comprehensive HR & Payroll Services
The method by which owners of startup businesses pay themselves generally depends on how the company is structured. Sole proprietorships and limited liability corporations (LLCs) may pay owners by drawing directly from business equity. Owners of S corporations, on the other hand, must pay themselves a reasonable salary, which means they may have to process payroll.
Do startups need payroll software if they have only a few employees?
You start by designating and linking your bank account, then you add team members, set your pay schedule and sign up for benefits, if you wish. Time-tracking options include when your workweek starts, clock in/clock out preferences, and break and overtime settings. But as they grow and scale, some businesses find that Gusto doesn’t grow with them. For example, payroll and taxes aren’t available in all 50 states unless you upgrade to a pricier plan — which can be a stumbling block for remote or multi-location businesses. Below are 10 of the best HR software solutions that cater to startups and small businesses. Each software solution has different features, pros, and cons—it’s important for businesses to weigh them all to determine the right fit for their business needs.
Choose a Payroll System That Scales With Your Business
While Justworks can store and manage employee information for international workers on its platform, it doesn’t support global payroll—so you can’tpay international employees with any of its offerings. Plus, it doesn’t offer the same level of automation and integrations as other payroll platforms. That means onboarding new employees requires a lot of manual work, which is inefficient and time-consuming for growing startups. Justworks also requires a lot of oversight to ensure that new hires are set up correctly and have access to all the tools they need. TriNet’s PEO offers assisted payroll setup, automated W-2 filing, and automatic calculation and withholding of federal, state, and local payroll taxes.
Focus on features like payroll processing, benefits management, performance tracking, and employee data storage. It’s a solution that grows with you, helping you streamline operations and maintain compliance without the need for expensive infrastructure or additional resources. This advanced software offering includes automation features and a variety of HR tools to make payroll processing easier and more efficient. One neat feature is Rippling’s unique ability to handle both payroll processing and IT tasks, two key responsibilities that any startup must be able to adequately handle. When you combine its payroll, HR and IT features, it offers a three-in-one solution to make life easier for emerging startups. For startup founders, managing payroll can feel like a never-ending administrative burden that pulls focus from what really matters—building your product and growing your business.
Zoho People
Gusto has a mechanism where you can pay a $100 monthly fee and you get your R&D credit in real-time, meaning that a piece of it comes with each pay period. Rippling can handle the R&D credit by sending you a refund check, but does not have the automated real-time feature. Justworks, like Rippling, will send the full amount of the R&D credit claimed on your return once the IRS processes it. For startups already using QuickBooks for accounting, QuickBooks Payroll integrates seamlessly.
Its mobile-friendly design is perfect for modern startups, allowing both employers and employees to manage HR functions on the go. Zenefits also integrates with dozens of popular apps like Slack, Salesforce, and QuickBooks, giving startups seamless access to their broader tech stack. Small business payroll software automates many of these compliance requirements such as filing and paying payroll taxes automatically and alerting companies to upcoming compliance deadlines. They also help businesses classify their workers correctly as employees or contractors to avoid being fined for misclassifications, and they provide a record of payroll and employee time and attendance.
Some payroll platforms, like Wave, offer some basic features for free, while others offer tiered pricing. For payroll software like Rippling, you’ll need to reach out for a custom quote. Each January brings a raft of new tax laws, many of which affect a business’s payroll tax obligations. Running afoul of tax rules can lead to hefty penalties being levied against your company. ADP RUN’s custom reporting options let you base reports on employee or contractor data, payroll transactions, deductions or paid time off. The data can be filtered in more than a dozen ways, including net pay, special payments and payroll tax category.
Evaluate the pricing model of the payroll software to match your startup budget. Look for a cost-effective solution that aligns with your specific needs, streamlining payroll processes without unnecessary features that might incur additional expenses. 1 2 Cloud Payroll offers a user-friendly and HMRC-recognised cloud-based payroll system with built-in Workplace pension functions. With 24/7 accessibility, e-filing capabilities, and compliance with HMRC standards, it provides a cost-effective solution.
- Gusto and Rippling used to be very comparably priced for multi-state employers.
- You could also take a reputation hit if employees go public with the problem, and social media makes that easy to do.
- Managers can see at a glance which payroll runs are scheduled, in progress or awaiting approval.
Sequoia is a robust payroll platform, with a variety of features – from next-day direct deposit to automation benefits to tax filing capabilities – to really help streamline the entire payroll process. Additionally, it’s an ideal option for startups that are already using QuickBooks payroll for other accounting tasks, as it integrates seamlessly with that platform. It’s available in various pricing tiers so your startup can select the option that works best for it.
And while PEOs do rightfully point out that they can reduce benefits costs due to their negotiating power, a startup would likely end up paying more overall for their payroll costs. If you want to learn more, visit our article on typical startup payroll costs. Mistakes in payroll taxes can be a massive headache, involving endless notices, state and federal requests for late taxes plus penalties, payroll software for startups and hours on the phone with various agencies. So taking action to make sure both your federal and state payroll taxes are set up correctly from the start can be a lifesaver.