Free Payroll Software for Small Businesses

As a small business owner I know how strapped for cash many small businesses are. So it’s not surprising that free software is so attractive to small businesses.

One type of software that’s often essential for small businesses is payroll software. If you want to draw a salary from your business, or you have employees then it’s pretty essential to have payroll software.

If you’re looking for payroll software that’s free then make sure it’s appropriate for your country.

Free Payroll Software for USA Based Businesses

If you’re in the USA then you’re probably interested in software that will help you to file those W2 forms with the IRS. RealTaxTools offers W2 Tax Mate. The software isn’t free, but it is competitively priced relative to larger accounts and payroll packages. It’s also possible to download a free trial version. W2 Tax Mate will file both W2 and 1099 forms, potentially saving you a lot of time and money (especially if you have multiple employees).

If your payroll needs are more complex then RealTaxTools also offer Payroll Mate. This software will handle many common payroll tasks such as calculating Federal and State taxes (the software works in every state). It also automates many other US State tax calculations. Payroll Mate supports weekly, bi-monthly or monthly payroll runs. If your business is ready to upsize (or you need to file documents with an accountant) then Payroll Mate will export data to Quicken or QuickBooks. While Payroll Mate is another package that isn’t free, at least there is a free download and the software is very competitively price.

Other cheap payroll solutions for smaller American businesses include Paywindow Payroll System from ZPay and Medlin Payroll Software. Both are very low cost but they’ll get the job done if your payroll requirements are relatively straightforward.

Free Payroll Software for UK Based Businesses

UK businesses have a number of free payroll software applications to choose from. I quite like the look of 12pay‘s free payroll software. Only the Express Edition is free, but it’s probably going to be sufficient for a small business. If you like the free version then it’s not that expensive to upgrade to the Premium or Bureau Editions.

One other free payroll service I did find is PayRoo. PayRoo is available to UK businesses. This is an interesting service in that it is genuinely free (some small charges apply for larger businesses). The service is web based, so it runs in your web browser. This means it should run on PC’s as well as Apple Macs and even iPad tablet PC’s or Linux boxes. The service is fully HRMC accredited. So what’s the catch? PayRoo is advertising supported, so this is a little intrusive when you’re trying to file your payroll. However, as a free service it can’t really be beaten.

PayRoo also offer other services, such as the ability to process and e-file P11D expense and benefits forms electronically, and for free.

Free Software or Just Free to Download?

By the way, I’ve often been caught out on this in the past. If you’re using free software, then make sure it really is free! Many companies advertise free software but this usually means it’s only free to download. Or they might offer you a free trial version but you need to pay in order to use certain features (like file your payroll return online for example).

Some payroll software is free for 30 days. This might give you enough time to fill out and submit your payroll return, but it’s probably of limited use if you want to run a monthly payroll.

Alternatives to Free Payroll Software

QuickBooks and KashFlow are two popular payroll packages. Neither is free, but they’re generally competitively priced. Both are available for Microsoft Windows and Mac OS environments.

An alternative to buying software is to use an online payroll service. These often charge a monthly fee, or they’re available on a price-per-employee basis. Usually these payroll services and virtual accounts can be worthwhile in that they save the cost of employing a full time bookkeeper and they also save you from struggling with the complexities of having to run the payroll processing yourself.

Have I forgotten any other free or cheap payroll package? If you know of any other free payroll software application or web based service then feel free to add some information in the comments section below. Genuinely free software is especially welcome. Remember to add which countries the software can be used in!

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