Updated: August 04,2022
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Buying payroll software in the UK can be an uphill task.
A simple Google search will bring forth hundreds of options.
So how do you pick the right one?
I did comprehensive research to find some of the best solutions in the market today.
In this article you'll find:
My methodology
There are the steps I took to help me sift through the mountain of possible options. Each step shortened my lists further until I got the best payroll software in the UK.
Let's look under the bonnet.
We’ve partnered with the software comparison portal Crozdesk.com to help you find the right solution. Our partnership gives you free access to their tailored software selection advice and community negotiated discounts, taking the hassle out of the research process.
It takes just a minute to submit your requirements, and they will give you a call at no cost or commitment. You’ll get custom product shortlists covering the top solutions that best fit your specific needs from their team of software experts (via phone or email), and they can even connect you to your choice of the selected vendors. To get started, please submit the form below:
User friendly
Robust reporting
Built-in payslip printer
Sage Payroll is a subset of the Sage Group, a startup that has been in operation since 2011. Today, the company is present in 23 countries and has a customer base of 1,000,000+.
Here are Sage Payroll's features:
Sage Payroll offers real-time information reporting, which makes PAYE submission easier. You can use this software to submit Real-Time Information (RTI) digitally every time you pay your staff.
If you're looking for a solution that complies with HMRC, then this platform is perfect for you. This tool will help you report PAYE information online and in real-time.
This is one of the best payroll software for small businesses in the UK because it calculates employees’ deductions and payments. Examples deductions that this software records on payslips include:
What's more?
This solution allows you to make corrections and updates the next payroll.
With Sage Payroll, you can set up pension schemes (People's Pensions, NEST or NOW). Alternatively, you can set up a provider that you prefer.
This software comes with an inbuilt payroll printer. Therefore, you can print payslips and P60s without the need for special stationery. You save time and you also save money!
Most systems require that you reprocess pay runs after editing errors on employee pay.
Not with Sage Payroll.
This software has an inbuilt feature that helps you fix any errors that may arise easily and quickly. The solution then updates the corrections for the next pay runs. The changes also reflect on your staff’s payslips, too. The software also shows the amended items.
With this software, you'll always be in tune with the latest payroll regulations since these update automatically.
Sage Payroll has a 30-day trial period.
That's not all:
You get to use the software free of charge for three months after subscription!
Here are the rates of this payroll software for UK small business:
If you need to pay over 25 people, you can opt for Sage 50cloud Payroll.
The best thing about this plan is that it allows you to run payroll for an unlimited number of staff at only £81.50/month plus VAT.
Sage also gives you the option to link it to accounting software for up to 25 employees, for £51+VAT/month (up to 25 staff)
*Every plan gets to enjoy the same exact features. The number of employees brings about the cost difference.
* Note that you have to install Sage 50cloud Payroll on your desktop.
*Sage Business Cloud Payroll purely runs on cloud so no download necessary.
This simple payroll software for UK businesses eliminates manual processes.
What’s more?
You don't have to install anything to use Sage Payroll. All you need is an internet-connected device.
Some of Sage Payroll's features include but are not limited to payslip printing, calculation and of payments and deductions, auto-updates, payslips and P60s, workplace pensions, RTI ready, and HMRC compliant.
But:
This software's speed is slow when entering transactions like banking because it has a 3-step process. However, this is to minimize errors.
Also, it takes about seven days to clear a prenote. Note that the delays happen only during the authorization of new banking details. The process moves along much faster after that.
Newer version release comes with bugs. The good news is that the company quickly resolves the issues.
Video call support
Quick and easy set up
Affordable
Intuit QuickBooks acquired PaySuite cloud-based payroll software in the UK, in 2014. The partnership brought the 5 million+ businesses that were previously PaySuite's clients to join QuickBooks’s customer base.
Here are Intuit's features:
Intuit is one of the UK's best payroll software because it submits the necessary data to HMRC in real-time. You can set this feature to run automatically to avoid missed filing.
The system then sends you automatic updates so that you can have peace of mind knowing no fines are coming your way.
Pension enrolment is yet another function that you can set to run automatically with this solution. This is one payroll area that will leave you with enough time to run other areas of your organization.
Your staff can upload their own data to free up your management time.
Sometimes, you just want to talk to a real person when experiencing an issue with any software.
Aside from phone and online chat, this solution has a video call feature, which makes it one of the top payroll software in the UK. Here you can get to see instructions on the support person’s screen in real-time. Quite unusual, but extremely useful.
This software comes with inbuilt reports to help you understand your payroll data better. The documents will give you better insights into things like staffing costs, leave requests, or rotas.
If you're a business in the construction space, then this solution is ideal for you. It supports HMRC's CIS on both plans.
With this solution, you can create and send payslips to your staff via email. The payslips show things like deductions and net pay in case your employees want to follow up on anything.
This software is also a payslip generator for UK employees. Your team can print them out if they wish to.
Intuit allows you to save 50% of the initial costs for six months. Note that you have to subscribe to at least one QuickBooks plan and choose payroll as an add-on. Here are the software's pricing options:
Intuit is a reliable payroll tool for the construction industry, but it can work with any other business type in the UK. Some of this tool's features include HMRC submissions, payslip printing, CIS, automatic enrolment, and video support.
Note that the solution can be difficult to troubleshoot because there are too many steps. Therefore, it becomes hard trying to figure which part of the process is causing the issue.
The good news is that Intuit has 24/7 support to assist you whenever you get stuck.
Robust reporting
Customisable software
Payment alerts
Duane Jackson, a web developer, founded KashFlow in 2004. Jackson's business outgrew Excel, and he created a simple system to manage his accounts.
He soon started getting numerous requests for similar small business payroll software which gave birth to KashFlow. The company has multiple awards, as you can see here.
KashFlow's features are as follows:
The software automatically updates any changes you make on your payroll. It also submits your P11D forms and P60s in real-time.
KashFlow is HMRC compliant. That means that at no point will you get penalties and fines from the government for failing to submit VAT returns.
This solution runs checks for any discrepancies on your payslips before you approve them for pay date. It then presents a list of items that need your attention.
Staff can view their payslips from anywhere without any hassle, which makes this one of the top payroll software in the UK. Therefore, you don't have to send each employee their payslip, which can be redundant.
This platform comes with an easy-to-use calendar to help you keep track of your employees' holiday entitlement.
KashFlow is payroll software in the UK that is always updating its reports feature based on user requests and feedback.
There’s also one mind-blowing detail.
This platform has 45+ report types. Yes, you read that right - 45+.
They fall under three broad categories, namely:
This software has an auto-enrolment feature to ensure that all your employees comply with the UK pension laws.
KashFlow's paid packages are as follows:
*Automatic enrolment add-on is at £1/employee, £13.50/5 employees for both plans.
KashFlow is one of the more affordable solutions, especially when you take the features into account. They include robust reports, RTIs, employee self-service, holiday pay, HMRC compliance, automated payroll, and many others.
Note that this solution's automatic enrolment doesn't come with the monthly charges. You have to pay for it as an add-on. But bearing in mind that the platform doesn't have upfront fees or yearly renewal fees, paying for this feature is fair.
Real-time bank feeds
Account advisors
Constant upgrades
Xero went live as basic software in 2007. Since then, the company has grown in leaps and bounds and often has frequent software updates with more superior features. To date, this software's client base amounts to 2,000,000+.
Here are Xero's features:
Xero is one of the best payroll software for UK enterprises because it updates your pension and payroll accounts automatically. In addition, it forwards your data to HMRC.
Xero payroll has built-in timesheets to track how many hours your staff has worked. It then seamlessly automates calculations of payments due, making it easier for you to run payroll.
With this software, you can choose payment periods suitable for your organization. That means you can pay your employees on a weekly, bi-weekly, or monthly basis.
You might have staff that works different roles in your company. This software allows you to pay them at different rates for each pay period.
Xero is one of the best UK payroll software because it comes with iOS and Android apps. Therefore, staff can access their payslips from anywhere. For security measures, the system encrypts the digital payslips to ensure they reach the intended recipients safely.
Reimbursements can be time-consuming if you don’t have the right solution. Refund staff for expenses spent on the job as you run payroll with this solution.
Xero Payroll comes with a 30-day trial period for you to experiment with its features.
It gets better.
This payroll software for the UK is free to use for three months!
Note: Xero payroll doesn't come as a stand-alone package. You have to subscribe to one of the software's all-inclusive accounts and then add the feature.
Here are the tool's packages and their rates:
Xero Payroll is a scalable software that will grow with your business. Its features include HMRC submissions, expenses refund, flexible calendar, built-in timesheets, encrypted payslips and multiple pay rates.
Although this platform is easy to set up, it has a steep learning curve. The good news is that you'll get an advisor to guide you initially. After a while, it becomes easier to use.
Free tool
HMRC compliant
Calculates apprenticeship levy
Her Majesty Revenue and Customs is a non-ministerial organization that the UK Government formed in 2005. The purpose - tax collection, the issuance of national insurance numbers, the regulation of minimum wage, and some state support issuance.
Here are HMRC Basic PAYE Tools features:
You can use this HMRC payroll software to let the organization know the deductions like National Insurance contribution or tax from your employees’ pay. Note that you must send every staff member's FPS for each pay run.
If you have new staff and would like to ascertain their insurance numbers, this software can help. In addition, you can use it to find out what a fresh employee's insurance number is, in case they've forgotten.
This feature comes in handy:
If you have employee details that you'd like to change, you can use this tool to do so. It allows you to change deductions and pay information for a tax year that's over.
This is one of the few free payroll software in the UK. In other words, there are no charges for using this platform. You get all the good stuff without paying.
HMRC Basic Tools is a simple solution that can help you run your payroll. Some of this software's features include National Insurance number verification, full payment summary, earlier year update, an employer payment summary.
Note that this software doesn't perform automatic enrolment for you. Therefore, you have to do the process manually, which means that your payroll could be prone to human error.
This software isn't ideal for you if you have more than ten employees. It’s also unsuitable for agents/bookkeepers with more than three customers, and each must have less than nine employees.
In addition, if you're looking for software with a payslip function, Basic PAYE Tools is not the software for you. Luckily, we have plenty of other options on our list with that feature.
Nevertheless, it’s still a useful tool for performing basic payroll functions. Anf it’s free, which definitely makes it a great solution for people on a tight budget.
Plenty of options
Excellent telephone support
Constant updates
This company has over 40 years of payroll management experience. Over 330,000 businesses in the United Kingdom rely on it to manage their payrolls.
Here are IRIS's features:
This software fully supports furlough teams and is excellent with handling JRS claims. It also ensures that your payroll is fully compliant whether it's on holiday pay calculations or allowances.
IRIS is one of the best online payroll software in the UK when it comes to supporting business initiatives on benefits like childcare vouchers or salary sacrifice.
This software has 22 payroll products, which means you have quite a lot to choose from. Here are some of the solutions:
This solution is HMRC approved and RTI compliant. Also, it doesn't have a 30-day limit.
IRIS automatically enrols pensions to comply with government regulations.
IRIS calculates NI, PAYE, and all other statutory payments automatically. The software allows your staff to print out payslips through either tablet, smartphone, Mac, or PC.
This feature monitors the time that your employees are off work. This is an important feature depending on whether your staff have paid or unpaid holiday/leave.
IRIS is one of the best free payroll software in the UK because of its IRIS Payroll Basic plan. Note that your business must have less than ten employees to enjoy this tool.
The solution also has paid packages, some of which display pricing. For some plans, you have to contact the company for quotes.
Here are some of the company's packages:
IRIS payroll is one of those solutions that have something for everyone. The software is so broad that it can be the best payroll software in the UK for large companies or serve small companies with less than ten staff.
Some of its features include payslip printing, HMRC compliant, job retention scheme, absence holiday diary and auto-enrolment.
Although some IRIS packages can be costly for small enterprises, it has a lot to offer larger organizations. Luckily, there are packages within the same solution that are suitable for SMEs.
Easy to use
Constant updates
Excellent customer support
Ed Molyneux, Roan Laver, and Olly Headey founded FreeAgent in 2007. Since its inception, the company has been making headway with constant improvements on its features, to serve its clients better.
The bank of Scotland currently owns the software. To date, this solution has 200+ staff working to ensure that FreeAgent remains to be one of the most popular payroll software in the UK.
Here are FreeAgent's features:
This software automatically forwards the necessary data to HMRC as you run your payroll every month. Therefore, with FreeAgent, staying compliant will never be an issue.
This tool has an inbuilt stopwatch and timesheets to track time for you automatically. That means you don't have to waste time entering the hours worked into the system.
FreeAgent is one of the top 10 payroll software in the UK because it generates payslips automatically. The documents are available online for you to edit and print. At the end of the year, you can print P60s for your employees.
Connecting some solutions to bank accounts can be hectic. This solution links to bank accounts directly.
FreeAgent has a calculator to help you calculate claims for your furlough staff. It has essential features, such as:
This feature also gives you an option to include pension and National Insurance Contributions.
This is yet another one of the best free UK payroll software. However, to get access to the free payroll, you have to subscribe to one of the paid packages that also incorporate accounting.
Here are FreeAgent's premium plans.
NB: You can use FreeAgent for free if you have a current business account at the Royal Bank of Scotland or NatWest.
*FreeAgent is free for the first 30 days.
FreeAgent is an excellent solution to help you manage accounting and payroll. Some of its features include HMRC compliance, RTI support, stopwatch, timesheets, bank payments, and furlough claims calculator.
Note that this software's reports are limited, but bearing in mind that it's best for small businesses, they work just fine.
Flexible payslips
User friendly
Multiple employers
Moneysoft has been in the market since 2000. This solution is suitable for agents, CIS contractors, employers.
The following are MoneySoft’s features.
This software will always ensure that you stay on the right side of the law by submitting relevant payroll information to HMRC. It's also RTI compliant helping you make all your submissions on time.
This solution comes with inbuilt NIC and tax rates. It then populates the data automatically in your payroll, saving you time.
MoneySoft allows you to add company logos or notes on your payslips. This online payslip generator for UK businesses also will enable you to print them on plain paper or pre-printed stationary for variety.
This solution files the following docs online for you for easy access:
The platform validates data before submitting and alerts you if anything’s missing.
With this software, enrolling for workplace pensions becomes much easier because it does that automatically. It conducts employee assessments on your behalf and then calculates the qualifying earnings.
MoneySoft comes with a holiday fund feature. This solution also takes note of all UK work and national holidays and has an annual leave feature that's user-defined.
Moneysoft has a 30-day trial period. Here are the software premium plans:
*All plans come with a 12-month license.
Moneysoft is one of the top 5 payroll software in the UK because it offers value for money. HMRC approved RTI compliant, automatic enrolment, holiday pay, flexible payslips and online filing.
Unfortunately, this software doesn't have a Mac version. The good thing is that we have plenty of other options that you can use on the OS.
No phone apps
Buggy auto-enrolment feature
Different Mac and Windows versions
BrightPay has 25 years of industry experience. This solution started as a small company with two staff members, and that figure has grown to 45 employees to date. BrightPay currently has over 250,000 clients scattered across Ireland and the UK.
The following are BrightPay's features:
This software helps in determining eligibility and calculations of statutory payments such as:
This solution automatically enrolls your staff's pension through several schemes including but not limited to:
BrightPay aligns the tax year with the annual leave days to do correct calculations for payday. This feature also displays the balance of annual leave days on staff payslips.
This payroll software for the UK market has a responsive employee calendar that helps you set working and non-working days. You can also set both paid and unpaid leave days.
BrightPay enjoys full recognition by the HMRC. It also submits relevant data in real-time, saving you from penalties.
Even better:
This software allows you to send multiple RTIs at once.
With BrightPay, you can choose to print payslips using Sage/IRIS stationary or a blank paper. One-click is all it takes to email payslips to your staff. It also allows you to export the documents as PDF files.
This solution has a 60-day trial period. Here are its paid packages and their rates:
Standard for individual employers (One employer)
Bureau for payroll service providers (Unlimited employees)
It is one of the best bureau payroll software in the UK.
BrightPay is a feature-rich solution, with transparent pricing. It has plenty of useful payroll features, and some of them include automatic enrolment, RTIs, HMRC compliance, payslips, employee calendar, and so much more.
Note that this software is only limited to Windows and Mac operating systems. However, we have plenty of other solutions on our list that work well with other devices.
Payroll in the UK software is a system or program that streamlines various processes to make staff payments. It automates some functions like payment calculation, enrolment to pension schemes, RTI submissions, or making direct deposits.
There are advantages to implementing payroll software in your organization. Some of the benefits include:
Manual calculations of payroll are time-consuming because you have to manually track time, work out tax deductions, overtime, pension, and so many other things.
These systems automate most tasks, saving your time or that of your managers, which you can otherwise channel to other areas of your business.
Not submitting VAT or PAYE data to HMRC can lead to hefty penalties. Most online payroll software in the UK file data directly to the organization, saving you the headache.
The platforms also stay up to date with the latest tax regulations which change frequently. You don't have to lift a finger if you have the right payroll software to help you stay on top of your game.
Since the software calculates payments automatically, there are no chances of human error. Bear in mind that mistakes in your payroll data can lead to fines and taxes from the government.
Think about it:
Your payroll software providers in the UK can calculate payroll faster while eliminating human errors.
The end result is that your staff will always receive their payments on time.
This simple guide will help you select the best payroll solution to suit your business's needs.
Pricing is a vital factor to consider with any purchase. The solution that you pick should depend on your budget.
Some solutions like HMRC Basic PAYE Tools are free of charge but limited in features. Others like KashFlow or Sage Business Cloud Payroll are affordable. Others like IRIS might be a little pricier but have more features.
Discounts can help cushion your operating costs, especially if you’re just starting out. Some platforms need 100% of the payment upfront, while others will charge a percentage of the total costs.
Let me elaborate on that:
Some payroll solutions like Intuit give you a 50% discount for the first three months. Others like Sage Business Cloud Payroll, offer 100% discount for three months once you subscribe to a paid plan.
The tasks that you intend your payroll tool to perform should be one of the most important things to guide you on choosing the right one.
For instance, some software like HMRC Basic PAYE tools is limited in functionalities. This software doesn't have features like automatic pension enrolment or payslips. Others like Sage Payroll, Xero, or KashFlow have this and all the features that you need.
It's paramount that businesses submit their tax information to HMRC. If you fail to do so, you could end up facing penalties from the government. Go for software with inbuilt HMRC payroll tools that will carry out the task automatically, rather than those that will require you to do it manually.
It's best to pick solutions that give you a free trial period to enable you to experiment with their features. Note that some software like Xero or BrightPay has more extended trial periods; 30 and 60 days, respectively. Others like KashFlow give you 14 days.
Go for solutions that allow you to pay the number of staff that you have.
Some platforms have a cap on the number of staff that you can pay through them, while others don’t.
Therefore:
If you have 50 employees, there's no point subscribing to a payroll tool that can only allow you to pay three.
For example, HMRC Basic PAYE Tools has staff limitations (maximum of nine). Others like SAGE can handle up to 25 staff, while some like IRIS can handle upwards of 10000 employees.
The industry that you’re in is yet another determinant of what to pick.
Some payroll software like IRIS are flexible and can handle payroll for organizations in any industry. Although solutions like Intuit are also versatile industry-wise, each of their plans has CIS, making it suitable for construction companies.
Payroll software for any UK business offers a lot of advantages. With the platforms, you stay compliant, save on time and money, eliminate human errors, and pay your employees on time.
Before you buy any payroll solution, it's paramount that you pick one that's best for your company. Our smart guide will help you choose one that's suitable for your business.
The easiest software to use is KashFlow Payroll.
The best small business payroll software in the UK that’s free is IRIS Payroll Basics and HMRC Basic PAYE Tools. IRIS Payroll Basics has more features such as automatic pension enrolment and payslip function compared to Basic Tools.
The most used accounting software in the UK is Xero.
The best payroll platform is the one that suits your business needs. Our top nine solutions are as follows:
The best free payroll software is IRIS Payroll Basics because it has features like automatic enrolment and payslips.
The following are steps to doing your payroll.
Eve-Carrie
Eve is a lover of everything technology. Figuring out how software works and creating content to shed more light on the value it offers users is her favorite past time. When not evaluating apps or programs, she's busy trying out new healthy recipes, doing yoga, meditating, or taking nature walks with her little one.
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