Anyone who has ever done it will tell you running payroll is not only time-consuming but also mentally exhausting. From calculating payroll taxes to adding and subtracting employee time off and benefits administration, there are so many elements and factors involved that manual payroll processing leaves a lot of room for error.
But thanks to technology, we now have unlimited payroll software in the market, which makes the job easier. These online payroll systems come with a multitude of payroll services that offer an easy-to-manage payroll solution.
But before we list down the best payroll software for 2020 let’s have a look at what payroll processing is:
What is Payroll Processing?
Payroll processing involves a number of steps that are needed to pay employees on their payday. The process includes steps like employee time tracking, benefits management (deduction and contributions), payment of salaries, bank deposits, tax calculations and filing, distribution of payslip, etc. Another term used for this process is payroll run.
Benefits of Using Payroll Software?
As mentioned before, paying employees is not an easy task. In order to do it efficiently and without wasting time, companies either use payroll software or outsource companies that offer payroll services.
Here are a few benefits of why buying a payroll software is a smart choice:
- It helps you save time.
- Using software provides regular tax updates.
- It is cost-effective.
- It minimized the margin for error.
- It helps you pay your employees on time.
- It simplifies the entire process.
- Payroll software is easy to set up and use.
- You can get added security from your payroll software.
Now let’s have a look at 5 of the Best Payroll Software for 2020:
6 Best Payroll Software for 2020
GoCo offers an exceptional platform that allows you to automate your workflow without forcing you to change your processes. That’s because the software’s Auto Sync feature enables you to sync the platform with any major payroll providers, so you don’t have to set up another system from the ground up.
In addition, the GoCo platform offers a powerful benefits deduction feature, which means that you can have payroll deductions calculated with just a click. You can also do new hires’ payroll set-up using GoCo’s intuitive onboarding feature.
GoCo is also your system of record for all your employees. This means that any change made to personal details, compensation, or tax withholdings is automatically synchronized to your existing payroll system.
GoCo Main Features
- Allows users to welcome new hires with effortless payroll set-up
- Syncs with major payroll providers to save your time setting up new processes
- Collects employees’ information automatically — including direct deposit information, W-4 withholdings, and more
- Automatically updates any change made to personal details, compensation, and benefits
- Enables you to keep a detailed record for all your employees
- Allows you to see a breakdown of how much is being spent on each employee and dependants
- Offers ACA compliance
- Generates and files 1094 and 1095 forms
- Calculates full-time and hourly employee’s final paycheck
- Calculates prorated wages, time off liabilities, and benefit deductions
- Avoid costly manual errors
- Helps employers to keep compliant all year round
- Saves you time and effort since it doesn’t require you to set up new payroll processes
- Allows you to keep track of all HR details from one software
- Makes all the final paycheck calculations
- Allows you to keep using your favorite features from your current payroll software
GoCo has a “freemium” model. This means that the company allows users to utilize basic features of the software, but charges a fee if you want to upgrade your plan.
The free plan is made for companies with 20 employees or less that need basic HR tools. It offers a modern HR platform and onboarding features. However, if you want to take advantage of the Payroll Sync feature, you would have to upgrade to the Premium HR plan.
The upgraded plan gives your company access to multiple features. It costs $80 per month plus a $4 fee per employee. There is also the option of including add-ons which allows you to personalize your plan. GoCo’s website lists all the details on each add-on’s price and benefits.
2. Intuit QuickBooks Payroll Software
Intuit QuickBooks Online is one of the leading cloud-based payroll and accounting software for a small business. According to the official website, you do not have to be an accounting expert to use QuickBooks. Due to its user-friendly interface and features, 98% of QuickBooks customers believe, the software makes managing easier.
It uses Key Performance Indicators (KPIs) to allow users to get an insight into organizational performance and business trends. The software has a number of payroll features, which simplify the accounting process and makes it easier to manage pay stubs. The accounting system claims to save 40 hours a month.
The software allows you to set up automatic payroll. You just have to do the initial set up after which the system runs automatically. It lets you stay on top of things by sending prompt alerts, reminders, and notifications regarding all payroll and accounting due dates and schedules.
QuickBooks Main Features
- It allows users to connect their bank accounts to categorize and import transactions automatically.
- It allows recording and tracking of expenses for tax season.
- It offers Tax Penalty Protection, which helps you solve tax filing errors and pay fees and penalties.
- The software photographs, saves and organizes receipts.
- It allows automatic calculation, filing, and payment of federal and state taxes.
- It lets you create customized invoices, estimates, and receipts.
- The software allows you to schedule recurring payments.
- The direct deposit feature allows quick access to money.
- It provides bank-grade security.
- Automatic backups.
- It integrates with all the major apps such as PayPal, Google, Constant Contact, Shopify, Square, Insightly, and Constant Contact.
- It helps in tax savings. On average, the system helps customers save about $3,534 in taxes.
- Lets you pay multiple bills and vendors simultaneously.
- Accountants can manage it from anywhere and at any time.
- It allows you to sort your transactions automatically into different categories.
- Quickbooks comes with a mobile app.
QuickBooks offers three types of plans:
- Simple Start – It comes with limited features and is available at $15 per month
- Essentials – It offers some additional features and is available at $23 per month.
- Plus – It is a full-service plan and is available at $31 per month.
You should keep checking the official website for discounts and special offers.
According to its website, QuickBooks has more than 5.6 million customers. The company’s free trial period is 30 days after which you will have to purchase the online software to keep using it.
3. Gusto Online Payroll Software
Gusto is a modern full-service payroll system and people platform that allows small businesses to look after their teams. It was founded by Joshua Reeves, Edward Kim, and Tomer London. The platform handles payroll taxes and also answer Human Resources related questions. The objective of the software is to simplify tasks and make them less time-consuming and easier to manage. From calculating to filing payroll taxes, the software offers a one-stop solution.
Gusto can be set up to run every pay period automatically, which can save you time. The software not only manages salaries but also factors in benefits to compute complete wages.
Gusto Main Features
- It calculates, files and pays all state and federal taxes automatically.
- You can generate and download payroll history reports.
- It can be integrated with other software such as QuickBooks, Freshbooks, and Xerox.
- New hire reports are generated automatically.
- It allows you to manage employee benefits and sync insurance deductions automatically with payroll.
- Gusto also allows employee time tracking.
- It allows direct deposits, which means salaries are sent directly to employees’ bank accounts.
- The software lets you manage time-off deductions.
- The autopilot feature runs payroll a day before the deadline.
- The automation processes help you save valuable time.
- It reduces the margin for error while computing wages and managing payroll.
- Gusto makes it simpler for you to manage and administer employee benefits.
- There is no payroll setup fee.
- You can run payroll in all 50 states within the United States.
- The software is compatible with your tablet and cell phones.
- It is a good HR platform for managers and executives.
- It allows third-party integration.
The software offers 3 main plans with a few core and plan-specific features. All plans are priced differently.
- Concierge Plan – Base price of $149 per month with $12 per month per person.
- Complete Plan – Base price of $39 per month with $12 per month per person.
- Core Plan – Base price of $39 per month with $6 per month per person.
You can also have add-on services that will drive up the cost of the plan you choose. According to the developer, over 100,000 businesses are using Gusto and 85% of these customers state that it is easier and simpler than their previous payroll system. Gust also offers a free trial period of 30 days after which you have to purchase the software to keep using it.
4. Patriot Software
It is an integrated payroll and accounting management system/software. Patriot Software is one of the more cost-effective options for payroll information management. The software offers high-level security and user-friendly features and tools. Patriot Software is a particularly ideal in-house payroll solution for small business owners.
This HR software allows users to streamline tax submissions and payroll payments. It provides basic assistance for creating, integrate contributions and deductions, manage payroll runs and auto submission of payroll taxes.
This small business payroll management system was founded by Mike Kappel who is an entrepreneur and CEO of Patriot Software.
Patriot Main Features
- It allows direct payroll deposits in the bank accounts.
- It offers personalized employee portals that enable them to access their own payroll and financial details.
- Patriot deposits and files all federal and local taxes.
- Enables tax reporting by allowing printing of W2 tax forms and generating year-end reports. It also submits tax forms to the concerned agencies at the end of each quarter or year.
- Customizes deductions and contributions for employees’ health insurance, 401 (k) plan, garnishments, etc.
- You can manage employees’ PTO accruals.
- It offers a lot of free assistance with the basic payroll system set up.
- Patriot also offers many other free services and features.
- It has features that enable employee self-service through personalized employee portals.
- The software can be integrated with third-party systems.
- Patriot Software is very easy to use.
Patriot Software offers two plans.
- Basic Payroll – This comes with limited features and has a base price of $10 per month plus $4 per month per employee.
- Full-Service Payroll – This plan is inclusive of all the features and has a base price of $30 per month plus $4 per month per employee.
There are also a few add-on services that can be purchased and integrated with the system. The developers also offer a free trial period of 30 days after which you have to purchase the product to keep using it.
5. Automatic Data Processing (ADP)
With more than 700,000 customers, ADP is one of the world’s biggest (Human Capital Management) HCM solutions software. From processing payroll to benefits administration and onboarding of new hires, ADP provides efficient services to businesses of all sizes. According to stats, one out of every six American employees gets their paychecks through this platform.
ADP automates all payroll software solutions, which allows users to save time and money. The management system has an easy set up that organizes payroll data, offers HR solutions and integrates talent and technology to offer excellent employee experience and enhance performance.
ADP Main Features
- It allows direct payroll deposits in bank accounts.
- Users can calculate and file all federal and local taxes.
- The Time and Attendance feature allows automated employee time tracking.
- The Talent Management feature helps with talent acquisition and training and development.
- From health insurance to retirement plans, Employee Benefits Administration makes benefits management simpler and better which helps improve employee engagement and employee retention.
- You can get an estimate for the value of your retirement savings on the basis of contributions, taxes, and balance.
- The software not only helps with payroll processing but also offers HR solutions.
- It shows real-time analytics and offers cloud-based storage.
- ADP has iOS and Android mobile apps that allow you to access your account on mobile devices.
- The software comes with a demo and useful video tutorials on software usage.
- ADP has excellent customer support.
- Cloud-based storage allows you to access your account any time from anywhere.
ADP offers four different packages. However, you have to ask the official website for pricing.
- Essential Payroll – This plan comes with limited features and is ideal for small businesses and established companies that need basic payroll.
- Enhanced Payroll – It offers basic payroll, garnishments, labor law posters, and SUI.
- Complete Payroll and HR Plus – This plan offers basic payroll, employee background checks, employee handbooks, and HR Help Desk.
- HR Pro Payroll and HR – This plan offers all the features.
If you are a small business then, ADP offers free 3 months after you sign up.
6. Xero Software
Xero is another major cloud-based payroll provider that offers both payroll and accounting services. The software has been a direct competitor of QuickBooks and offers accounting and payroll solutions. Here we will focus on its payroll functions.
The software comes with all the tools needed for running payroll with automated schedules. It helps you save time and money by keeping all your information in one place. The software also does automatic updates of your accounts and keeps you in the loop by sending regular alerts and notifications.
Xero Main Features
- Xero payroll allows direct deposits so that employees do not have to wait to get their pays.
- It allows time tracking and PTO management.
- It has the feature to send encrypted E-payslips to employees, which eliminates the need to print slips.
- The software also allows expenses reimbursements along with pay run.
- It allows you to generate payroll history reports.
- You can manage multiple pay rates of an employee using.
- Xero supports an unlimited number of users.
- Ideal for businesses of all sizes.
- It has a mobile app, which makes it easy to access.
- It allows you to send information to Nest.
- It allows employee self-service.
- The full-service plan is available in all 50 U.S. states.
Xero offers three different plans.
- The Early Plan – This plan offers limited features and is available at $9 per month.
- The Growing Plan – It comes with limited features and is available at $30 per month.
- The Established Plan – It is a full-service plan with all the features. The plan is available at $60 per month.
Xero offers a free trial period of 30 days after which you have to buy the software to keep using it.
Which Payroll Software You Should Choose
Investing in an excellent payroll software is a no brainer. This investment will save you countless hours of manual work. Counting with the help of payroll software will also ensure that there will be no mistakes on payroll, which can cost you a lot of money. In addition, it will help you to stay compliant all year round.
In order to choose the best payroll software for your business, you must outline what are your company’s needs. Once you have that clear, you can evaluate which software will offer more benefits for you. Another aspect that will help you to narrow your decision down is budget. Some payroll software offer more than just payroll, but they also charge a higher monthly fee.
The bottom line is: whatever your payroll software pick is, you can’t afford to have any. So, choose your favorite, set up the system, and let the software run the rest for you!