The 6 Best Free Payroll Software for Small Businesses in 2021

The bottom line: As one of the most fully featured free payroll programs for small businesses, Payroll4Free is our top free software recommendation. If you’re fine with open-sourced software, TimeTrex Community Edition offers nearly as many features as Payroll4Free with stellar time-tracking integration. HR.my’s free payroll app and availability in 65+ languages make it a good fit for international businesses. If you’re already using Microsoft Office Suite, ExcelPayroll integrates seamlessly with your existing payroll software. Finally, if you need just a calculator with paycheck-printing capabilities, try eSmart Paycheck for businesses with no more than 10 employees. Keep reading for more info on the year's best free payroll software for small-business owners.

Payroll is complex, and it only gets more complex the more employees you have. Payroll mistakes can have huge financial consequences not just for your employees but for your business, especially once the IRS gets involved. That’s why we and most of our top free payroll picks tend to recommend free software only to businesses with 10 or fewer employees. (The main exception is Payroll4Free, which supports payroll for up to 25 employees and has nearly as many features as most paid self-service payroll providers.)

If you do choose free payroll software, make sure to keep detailed financial records (which you can do for free with free accounting software) and to double- and triple-check your paycheck and tax calculations. Most payroll providers offer free trials—you can always give paid software a go and cancel if you find it doesn’t meet your needs. In particular, ADP has a three-month-long free trial, SurePayroll has a two-month free trial, and Gusto has a one-month free trial.

If you’re interested, we also offer a few free payroll aids:

• Free Hourly Paycheck Calculator
• Free Salary Payroll Calculator
• Free Payroll Templates

If you want free payroll software that does pretty much everything paid software does, Payroll4Free is at the top of its class. Honestly, its features compete with other paid self-service payroll plans:

• Paycheck calculations
• 1099 contract and W-2 employee payments
• Direct deposit and paper check options
• Federal, state, and local payroll tax calculations
• Pre-filled tax form access
• Reports on taxes, benefits, payroll statistics, and more
• Employee self-service portal
• Paid time off, vacation, and sick time accruals
• Accounting software integration, including QuickBooks

Payroll4Free’s reporting and paid time off (PTO) tracking features are particularly impressive. (Even many paid providers don’t include those features with their cheapest plans.) And while Payroll4Free can’t file your payroll taxes for free, it calculates payroll tax deductions and autofills the tax forms. You have to do the actual filing, but form filling is easily the most time-intensive part of the process.

Payroll4Free offers all these features for free by running ads, which might be distracting when you use the software but shouldn’t otherwise impact your payroll process. The company also offers a few paid services at a lower cost than most payroll software. Most notably, automatic payroll tax filing with Payroll4Free starts at $12.50 per month.

Developers in 50 countries volunteer their time and expertise to keep TimeTrex Community Edition up and running. Since they work for free, you can access these payroll features for free too:

• Paycheck calculations, including taxes, wage garnishments, and other deductions
• Direct deposit and paper checks
• Easy-to-generate tax forms, including forms W-2, W-3, 940, 941, and 1099
• Employee access to electronic pay stubs
• Integration with other payroll software, including QuickBooks, Paychex, ADP, and SurePayroll

TimeTrex offers time-tracking software, which is also available for free on the Community Edition. But employees can clock in only online, and they can’t use the mobile app that comes with TimeTrex’s paid plans. Still, the time and attendance tracking syncs automatically with your payroll software, which makes paycheck calculation a breeze.

Unlike the majority of payroll software—both free and paid—HR.my's payroll software is available in 65 different languages. Its comprehensive payroll-processing features compare to both TimeTrex’s and Payroll4Free’s:

• PTO management
• Attendance management and time clock integration
• Automatically generated payslips
• Multiple pay schedules, including weekly, biweekly, semi-monthly, and monthly
• Leave approval
• Unlimited users, including employees and managers
• Unlimited employee web accounts for pay stub access and PTO requests
• Mobile payroll app (Android and iOS) for employers and employees

HR.my is based in Malaysia, which could be a problem for US-based customers who need customer service support during regular business hours. Plus, HR.my’s site is the sparsest we’ve reviewed. It lists a lot of features and includes a handy user guide for getting started, but we're a little wary of its lack of product details.

eSmart Paycheck isn’t a comprehensive online payroll software solution. Instead, eSmart Paycheck lets you calculate your employees’ net pay, including the amount of payroll taxes to withhold. It also prints payroll checks and creates pay stubs for free after you calculate your employees’ net pay. Its state-specific calculators help ensure you withhold the right amount for your state. Plus, if you want help filing taxes once you calculate them, eSmart Paychecks’s paid plans include eFile tax options.

Bear in mind that eSmart Paycheck doesn’t save your payroll data or help you track year-to-date payroll taxes. As a result, it works best for small-business owners who want an easier way to make free pay stubs online and quickly print real payroll checks.

ExcelPayroll is a free third-party payroll software and pay stub creator that integrates directly with Microsoft Excel’s spreadsheet software. Along with calculating paycheck amounts and payroll tax withholdings, ExcelPayroll lets you tackle these tasks in Excel:

• Printing pre-filled tax forms, including W-2s
• Printing checks
• Generating workers compensation reports
• Generating bookkeeping journal entries

Although ExcelPayroll is free, Excel itself isn’t. Microsoft Office Suite now operates largely as a cloud-based service instead of desktop software, and the cheapest version of Office 365 for businesses costs $12.50 a month with an annual commitment.

Want another easy, streamlined option for payroll calculation only? Like eSmart Paycheck, Paycheck Manager’s free calculator lets you calculate an employee’s net salary, then print paychecks and create pay stubs. If Paycheck Manager’s calculator seems too complex, you can use its simple calculator to make basic tax estimates. Want to save your payroll calculator data, access payroll reports, and offer pay stubs? Paycheck Manager’s paid plan costs $5 a month after a three-month free trial.

Unlike eSmart Paycheck, Paycheck Manager doesn’t offer a different calculator for each state. Otherwise, the two are about the same—neither is a full payroll management system, but if you need the simplest possible payroll module, either calculator should suit.

If you don’t love any of our recommendations, a cost-effective payroll solution can still help you save money on payroll. Our favorite cheap payroll plan is Patriot Software’s, which costs just $10 a month for self-service payroll. And if you only pay contractors, both Square Payroll and Gusto offer contractor-only plans with no monthly base fee.

Patriot Software’s Basic Payroll plan starts at $10 a month plus $4 per month per payee (including contractors and W-2 employees). The self-service plan doesn’t include automatic tax filing, but it does include direct deposit, unlimited customizable payroll runs, W-2 forms, employee pay stub access, and free payroll setup if you’re switching providers.

Interested in more than payroll calculations? At $30 a month plus $4 per payee, Patriot is also one of the cheapest full-service payroll providers. With the $30 plan, Patriot calculates tax withholding and automatically remits federal, state, and local taxes along with all end-of-year tax forms.

Square Payroll’s contractor-only plan doesn’t require a base monthly fee. Instead, you just pay $5 per month for each contractor you pay. If you work with contractors seasonally, you can put your account on hold at any time and resume paying contractors once work rolls around again. Square also mails end-of-year 1099 tax forms at no extra cost.

If you have ten or fewer employees, you can download a payroll template to use with spreadsheet software. Excel and Google Sheets are the most popular choices, though only Google Sheets is truly free—Excel costs a monthly fee. (Most of our recommended payroll templates also double as free pay stub creators.)

You can also use one of our payroll calculators to make sure you're withholding the right amount in payroll taxes.

Remember, compared to paid online payroll software, free payroll software has key downsides, especially its lack of automated payroll tax filing and guaranteed tax compliance. But if you can't (or don't want to) pay for online payroll right now, these online payroll services may cut your wallet some slack.

Need more payroll options? Find affordable paid alternatives in our review of the year’s best payroll software for small businesses.

To choose the best free payroll software providers, we looked at a few key categories, weighted equally:

• Pricing, including if the software was truly free, how and why it was free, and whether it offered paid plan options
• Payroll features, including tax calculation, direct deposit, employee self-service, free check stubs, and end-of-year tax forms
• Customer service, including phone support, email support, and online guides
• Trustworthiness, including online security, customer guarantees, transparency, data storage, and data encryption

Disclaimer

At Business.org, our research is meant to offer general product and service recommendations. We don't guarantee that our suggestions will work best for each individual or business, so consider your unique needs when choosing products and services.