5 Payroll Services for Small Business

Hannah Conway
06.11.19
9 minute read

If you run a small business then you’ll need a way to pay your employees - that’s simple, cost-effective and reliable. There are a number of handy payroll services available to save you the time, headache and risks of trying to do it yourself – and you may save money too.

In this article we’ll explore some payroll providers for small businesses in the UK.


TransferWise Payroll for global business

TransferWise offers a quick, easy and affordable way to make global payments with the real exchange rate. A great option for payroll – it’s an organised and fast way to pay people all over the world.

Sign-up for free and save time & money!

How to sign-up?

It’s free to sign-up to TransferWise for Business, and you can create an account in minutes. You’ll have to complete some online verification, but set-up is simple with easy-to-follow steps.

Pricing: Free to set up a TransferWise for Business account and to use the batch payments tool.

A cheaper way to make bulk global payments – as you’ll always get the real exchange rate. If you’re making payments in multiple currencies - there's a low, transparent fee to convert between currencies, so there's no surprises.

Ease of use:

It’s simple to use, and can save you time and money. Make up-to 1000 payments to multiple currencies with the click of a button. There’s no need to manually pay out to vendors or employees - just fill in one spreadsheet and TransferWise will make sure everyone gets the right amount in the right currency.

Check out the recorded webinar with the product team at TransferWise to find out more.

Payroll Processing Features:

Payroll can be automated with the open API, with payments distributed in seconds. They're paid directly to your recipient's bank account so they can receive payments quickly and securely. You can also use Time Doctor employee tracking software, and export your payroll straight to TransferWise.

Making Tax Digital:

You can automatically sync your activity with a Xero account, to manage your accounting needs seamlessly. Xero is a HMRC-recognised accounting software, so they can help you become MTD (Making Tax Digital) compliant.

Software integrations and reports:

Connect with Xero and your favourite accounting tools, to automatically sync your activity for over 40 currencies. You’ll also be able to hold 40+ currencies for free in a multi-currency account, so you can manage your business finances with ease - and it comes with a free business debit MasterCard.

Security:

FCA regulated, including anti money-laundering checks for compliance and security.

Customer support:

TransferWise has a great customer service team that are always happy to help. You can also find quick answers to a wide range of topics in the Help Centre. And, as you’re business grows, dedicated business support team is there to help.

Customer Reviews:

Over 75,000 reviews on TrustPilot: 94% Excellent or Great!

Sage Payroll Software

Sage payroll, formally known as Sage One Payroll, is a cloud-based platform offering secure, accurate and compliant payroll management. They offer services for different business sizes and accountants - including a payroll software aimed at small businesses.

How to sign-up?

Sign-up for Sage via their website, choosing a package that suits you. You’ll need to choose the package works best for you in terms of features, and the number of employees you need to pay.

Pricing: There is separate pricing for the Sage Business Cloud Payroll and the Sage 50cloud Payroll. The pricing for each package will depend on how many employees you have. For the Sage Business Cloud Payroll the price is broken down as:

  • Payroll 5 - £3.60 + VAT per month (up-to 5 employees)
  • Payroll 10 - £6.60 + VAT per month (up-to 10 employees)
  • Payroll 15 - £9.60 + VAT per month (up-to 15 employees)
  • Payroll 25 - £15.60 + VAT per month (up-to 25 employees)¹

The pricing for Sage 50cloud Payroll is:

  • Up to 15 employees: £19.50 + VAT per month
  • Up to 25 employees: £27.57 + VAT per month
  • Up to 50 employees: £55.50 + VAT per month
  • Up to 100 employees: £59.25 + VAT per month
  • Unlimited Users: £83.25 + VAT per month*²

You can try it for free for 30 days too, so you can figure out if it’s right for you.

*Prices valid at the time of writing. Prices stated are subject to offer of 25% off the price for the first 6 months - the cost is likely to increase after this period. For full prices details, visit the Sage website directly.

Ease of use: You don’t need expert knowledge to use Sage software, as its simple and straightforward to set-up. The platform is easy to use, and in most cases you can pay people in 4 simple steps.³

Payroll Processing Features: Handles workplace pensions and automatic enrolment. No payroll training or experience required, according to Sage, and you benefit from a 4-step pay run, with all calculations done for you.

Making Tax Digital: HMRC compliant, benefit from single-click real time information (RTI) submissions to HMRC.

Software integrations and reports: You can also combine each package with Sage’s accounting software, but this will involve a higher price.⁴

Security: Sage ensure that your personal and finance data is secure. So your payroll is safe, secure, convenient, and minimises payroll administration.

Customer support: Sage offers reliable payroll software for UK businesses of all sizes, with lots of time-saving features and 24/7 phone and email support from a UK based team.⁵ You can also access their Help Centre for quick answers to your questions.⁶

Customer Reviews: 5,454 reviews on TrustPilot: 91% Excellent or Great.⁷

Kashflow Payroll

Kashflow Payroll is a user-friendly platform designed to save you time, and it has great support options. It provides all of the essentials you’ll need for effective payroll as a start-up or small business, with a focus on automation to save you time.

How to sign-up?

Sign-up for your account online at the Kashflow website. You can sign-up for a free trial, before you commit - to see if it’s the right choice for you. You can also check out there demo by booking online.

Pricing: Kashflow pricing depends on the number of employees that you have. Prices start at £6.50 a month + VAT for up to 5 employees, with a cost of £1.10 per additional employee. This is just for the payroll service.

If you want to go for the Kashflow bundle with accounting included, it’ll cost you £21.00 a month + VAT, with a cost of £1.10 per additional employee. There’s also a free 14-day trial.⁸

Prices based on monthly contributions. For full details of pricing see the Kashflow site directly.

Ease of use: Handy information pointers and tips as you use the software, to help you get the most out of it. Employee self-service is available, so your team can access payslips and more themselves.

Payroll Processing Features: Automated payroll - meaning that your data is processed in one go. This means less manual input and a fast way to pay your employees.

Making Tax Digital: Kashflow is recognised by HMRC as a commercial software supplier of record keeping applications.

Software integrations and reports: You can integrate the payroll service with the Kashflow bookkeeping feature, so you can keep track of your business finances.⁹

Security: Kashflow take the security of your financial data seriously - ensuring that is secure in transit, storage, and it's physical security. You can find out more about how they keep your data safe via their site.

Customer support: If you need help, an award-winning UK support team is available on live chat and email.

Customer Reviews: 56 reviews on TrustPilot: 18% Excellent or Great.¹⁰

BrightPay

Winner of Payroll Software of the Year 2018 at the AccountingWEB Software Excellence Awards, BrightPay is a great option for those who value a good spreadsheet. It offers a simple interface, quick and easy payroll processing and essential payroll services at a transparent, reasonable price.

How to sign-up?

Sign-up online at the BrightPay website, and check out the free trial - so you can try before you purchase. You can also book a demo or contact their sales team directly to make an enquiry.⁹

Pricing: BrightPay costs from £49 to £249 a year + VAT, depending how many employees you have.¹¹

Ease of use: Optional BrightPay Connect cloud add-on offers online employee dashboards, employee self-service portal and many other features.

Payroll Processing Features: Handles all payroll processing tasks, including payslips. You can set payroll by the payment schedule you need, and process employees individually or as a batch - as well as much more.¹²

Making Tax Digital: You can use BrightPay to record payments to HMRC, and meet some of their obligations. For full details refer directly to the BrightPay website.

Software integrations and reports: Payroll journal integration with other accounting packages like Xero and Sage.¹³

Security: Secure cloud storage, so you can access and update employee records from anywhere.

Customer support: If you need help, an award-winning UK support team is available on live chat and email.You can contact the team by phone, email or online from 9-5pm Monday to Friday.

Customer Reviews: 12 TrustPilot reviews: 91% Excellent or Great.¹⁴

FreeAgent

If you find accountancy and payroll scary, you may want to consider FreeAgent – it’s an easy, user-friendly way to get those essential tasks done. Payroll is just one feature of the online accounting platform. An HMRC-compliant platform which was named the Small Business Accounting Software of the Year at the 2018 Accountancy Excellence Awards, FreeAgent has simplicity at its heart.

How to sign-up?

Sign-up online at the FreeAgent website. You’ll need to create a full account with FreeAgent, in order to use the payroll feature. You can try FreeAgent for free, for 30 days. If you’re an accountant you can also request a trial of the software.¹⁵

Pricing: FreeAgent costs from £19 to £29 a month plus VAT, depending on your business type – although new customers can benefit from special offers such as 50% off for the first six months. This gives you access to all FreeAgent accounting software, as payroll is included as standard (and you can’t use it as a standalone service).¹⁶ All plans offer the free 30-day trial.

Ease of use: Their neat, user-friendly dashboard offers a complete business overview.

Payroll Processing Features: Use FreeAgent with or without an accountant, and get automatic tax reminders and forecasts. You can automatically generate payslips for all employees each month, and generate P60s for employees.

Making Tax Digital: FreeAgent is an HMRC recognised platform, so they can help you to be MTD compliant.

Software integrations and reports: The FreeAgent platform has a number of features, such as time tracking, invoicing and expenses - to help you with all of your accounting needs.¹⁷

Security: FreeAgent take your security seriously. Protecting your personal and financial information through physical and operational security. For full details on how they keep your data secure, see their website.¹⁸

Customer support: There are two levels of support available from FreeAgent. They offer UK based support for small businesses and freelancers, but also for accountants and bookkeepers - so whoever you are, they should be able to help. ¹⁹

Customer Reviews: 451 TrustPilot reviews: 92% Excellent or Great reviews.²⁰

What should I look for in payroll software?

When comparing payroll services, think about the main challenges you face as a small business owner – time, money and expertise. You need something that fits your budget, is a breeze to use and that works for your business, without you needing to go on a six-week training course in order to use it.

What is payroll software?

Payroll software is designed to help businesses to manage and automate tasks related to employee pay. You can for tasks such as recording staff details, working out their pay and deductions, sending them payslips, and much more.

HMRC Compliance

You’ll need to use the HMRC PAYE Online service to send payroll reports, among other things to HMRC. Always check that a payroll service provider is HMRC-recognised before using it. All of the above are HMRC compliant, and there’s also a full list of providers on the HMRC website if you ever need to double-check.²¹

Ease of Use

You don’t have the time to spend learning how to use a complicated new system, so it needs to be easy, user-friendly and straightforward. Always take advantage of a free trial if it’s offered, as it gives you the chance to get to grips with all the features.

Pricing

Pricing usually varies depending on the features you need and the number of employees that you have. You’ll need to take the time to research which option is best for you, and also consider your projected growth as a business.

When should a company start using payroll software?

All businesses with employees must keep payroll records, and most must operate PAYE to meet their legal obligations. As soon as you register for PAYE, you need to sort out payroll software.


You should now have a better idea of the features to look out for when choosing payroll software for your business. It’s even straightforward when running international payroll, thanks to platforms like TransferWise. It’s amazing what can happen when you let technology do most of the work!


Sources used:

  1. Sage: Sage50 Payroll
  2. Sage: Business Cloud Payroll - Pricing
  3. Sage: Payroll Software - Small Business
  4. Sage: Payroll Software
  5. Sage: Help Centre - Payroll
  6. Sage: Payroll Software
  7. Trustpilot: Sage
  8. Kashflow: Pricing; Features
  9. Kashflow: Security
  10. Trustpilot: Kashflow
  11. BrightPay
  12. BrightPay: Pricing
  13. BrightPay: Features
  14. Trustpilot: BrightPay
  15. Free Agent: Sign-up with free trial
  16. Free Agent: Pricing
  17. FreeAgent: Payroll Features
  18. FreeAgent: Security
  19. FreeAgent: Contact
  20. TrustPilot: Free Agent
  21. HMRC: PAYE

Sources checked on 05-November 2019.


This publication is provided for general information purposes only and is not intended to cover every aspect of the topics with which it deals. It is not intended to amount to advice on which you should rely. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content in this publication. The information in this publication does not constitute legal, tax or other professional advice from TransferWise Limited or its affiliates. Prior results do not guarantee a similar outcome. We make no representations, warranties or guarantees, whether express or implied, that the content in the publication is accurate, complete or up to date.

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