Best Free Payroll Software for Small Businesses in 2025

Does the thought of running payroll for your small business give you some extra grey hairs? While you might be tempted to save some cash by going the spreadsheet route, manually tracking hours and calculating taxes can become another full-time job.

Luckily, there are plenty of options for free payroll software for small businesses. Using a free payroll service doesn’t just save you money—it saves you time, helps keep you tax compliant, and prevents payday from feeling like a chore.

Here are our top picks for small business payroll, a comparison of their top features, and how to know if it’s time to upgrade to a paid plan.

TL;DR: Comparing Free Payroll Services for Small Businesses 

Short on time but need your payroll questions answered? We got you.

Here’s your cheat sheet for the best free payroll software picks this year:

• Homebase: Best all-in-one payroll solution for hourly teams and small businesses. Time tracking, team messaging, scheduling, and payroll compliance rolled into one. Free for up to 10 employees.
• Payroll4Free: Best free payroll system for tiny teams who need basic payroll and tax forms but don’t mind a little manual work.
• HR.my: Best free payroll software for global teams needing a free HR management tool with payroll baked in (crowdfunded, ad-supported).
• ExcelPayroll: Best offline payroll software for spreadsheet die-hards who know Excel inside-out.
• Wave: Best payroll software for businesses with detailed accounting needs.

Must-have features of a free online payroll service:

• Automated wage and tax calculations
• Integrated time tracking
• PTO tracking
• Direct deposit
• Integration capabilities
• Compliance support for federal, state, and local laws
• Cloud-based access so you’re not chained to a desk
• A user-friendly interface (bonus if there’s an employee self-service portal!)

Things to consider when choosing small business payroll software:

• Team size and complexity (hourly vs. salaried, multi-location, remote)
• Whether you need payroll tax filing included (or just calculated)
• If the software plays nice with your existing systems (time clocks, POS, accounting)
• How much you want to automate (hint: more automation = less admin stress)

What is the best free payroll software for your business?

The best free payroll software is a cloud-based platform that manages payroll processing, tax calculation and filing, time tracking, and more. While there are several free online payroll services to choose from, the best one for your business really depends on your needs.

As you investigate your options, ask yourself:

• How many employees do you have?
• Do you have remote or multi-state employees?
• How frequently do you run payroll?
• What other small business management software are you using?
• How hands-on do you want to be with payroll?

Simple payroll software can get the basics covered, but you might end up needing to do some tasks manually. If your spreadsheet crisis extends into the scheduling realm, cheap add-ons can solve multiple problems in one place.

For example, the Homebase Payroll add-on hits all of your small business payroll needs, while also providing scheduling, time tracking, and employee management tools completely for free!

I honestly have not thought about payroll since switching to Homebase Payroll—which is the best endorsement I can give a platform designed to make you more efficient or take away a once tedious task. WE LOVE IT.

- Eric Murphy (Owner, The Gear Attic in Athens, GA)

{{banner-cta}}

How payroll software makes life easier for small business owners

Running a small business is already a juggling act—you don’t need payroll adding more pins to the routine.

Let’s break down how free payroll software helps you get your time and energy back:

• Efficiency. A free payroll service for small businesses automates number crunching, tax calculations, and direct deposits. This cuts a job that takes hours down to minutes—and saves you money along the way.
• Accuracy: Spreadsheets and mental math? Risky. Payroll software reduces human error by automating pay calculations and tax withholdings.
• Security: Employee pay information is sensitive stuff. Reliable free payroll software for small businesses uses encryption and secure data storage to protect your business and your team’s privacy.
• Streamlined processes: After a long workday, fighting with endless tabs and digging through papers is the last thing you need. Trustworthy, easy payroll software integrates every step of the payroll process into one smooth workflow. 
• Data transparency: Having all of your payroll data in one place gets you a bird’s eye view of your finances. Instead of digging through piles of paperwork (or a hundred unorganized spreadsheets), you can use payroll software to track labor costs, taxes, and trends in easy-to-read reports.
• Customizability: No two small businesses are the same. Good payroll software lets you tailor pay rates, deductions, PTO policies, and reports to fit how you operate.
• Greater control: Simple payroll software lets you call the shots with the click of a button. Need to adjust pay rates on the fly? Run off-cycle payroll? Tweak PTO accruals? You’ve got the power.
• Compliance: Labor laws are complicated, and can change without you realizing. Payroll software keeps you payroll compliant by automating tax deductions, keeping up to date with wage laws and FLSA rules, and storing accurate records.
• Employee self-service: Cut down on admin work with payroll tools that let your team access their pay stubs and tax forms on their own. Employee self-service portals make updates easy and eliminate those “Can you send that again?” emails.

How to choose free payroll software for your small business

Free small business payroll software should save you time and money—not create more headaches.

Make sure your software:

• Supports your number of employees
• Offers features like tax forms and pay stubs
• Is easy to use and set up
• Includes customer support or community help
• Integrates with your accounting software
• Is secure and regularly updated
• Can scale with your business

Best free payroll software options (2025)

Not all free payroll software is created equal. When you’re choosing a payroll provider, it’s important to make sure your pick ticks all the right boxes.

Let’s break down the details:

1. Homebase: Best all-in-one payroll software for small businesses

Homebase is designed for busy small business owners who don’t have time for spreadsheets, manual tax calculations, or hunting down late timecards.

With our payroll add-on, payroll connects directly to your time tracking and scheduling, so you can run payroll in just a few clicks. We automatically calculate hours, breaks, overtime, wages, and taxes based on your city, state, and federal laws—no mental math required.

Even better? You can process payroll on the go with our mobile app, set up auto-payroll, and rest easy knowing compliance features (like overtime alerts and recordkeeping) are built right in.

Why it works for you:

• Seamless time tracking and payroll in one place
• Auto-calculates taxes, overtime, PTO, and more
• Compliance support without the legalese
• Unlimited, next-day payroll runs
• Tip management tools
• Built for small businesses, not corporate giants

Tech requirements or integrations: 

• Available on Windows, Android, iOS, Mac
• Many integrations including Clover, Lightspeed, ADP Run, Square, and more

Employee limits: Basic plan is free for up to 10 employees. At all tiers, the payroll add-on remains $39/month + $6/month per active employee.

Ready to get payroll off the brain so you can get back to the good stuff? Let’s do this thing.

2. Payroll4Free: Best free desktop payroll software for basic needs

Payroll4Free is exactly what it sounds like: a no-cost payroll software that covers the basics for small teams. It automatically calculates wages and generates tax forms.

Additionally, Payroll4Free includes:

• PTO tracking
• Payroll reports
• Employee portal

Tech requirements or integrations: 

• Available on: Windows
• Integrates with Quickbooks

Employee limits: Free for up to 10 employees, then up to $40/month depending on tier

The catch? You’re handling direct deposits yourself unless you pay for their add-on service. If you want to keep it free, consider how comfortable you are with writing checks or handling ACH through your bank.

3. HR.my: Best free payroll software for small businesses who need HR basics too

HR.my is more than just a payroll tool—it’s a full-on HR management platform that happens to be free. If you don’t mind a more old-school interface, HR.my keeps things straightforward.

However, it does include features like:

• Unlimited payroll processing
• PTO tracking
• Auto-sends pay slips

Tech requirements or integrations: 

• Available on: IOS, Android, Mac, Windows
• No integrations

Employee limits: Unlimited

While HR.my is surprisingly robust for a free payroll software, it is ad-supported and community-funded, so you won’t find paid upgrades or useful add-ons.

4. ExcelPayroll: Best offline payroll software for spreadsheet pros

If you’re the kind of person who lives and breathes Excel, ExcelPayroll might feel like home. It’s a free spreadsheet-based payroll program without any bells and whistles.

This free offline payroll software automatically:

• Calculates wages, deductions, and taxes
• Prints W2 forms, W3, 940, 941, and more
• Produces PTO and workers' compensation reports

Tech requirements or integrations:

• Available on: Windows
• No integrations

Employee limits: None

ExcelPayroll isn’t cloud-based, so there’s no app or dashboard. If you want a mega-update to your spreadsheet game, it’s a great choice, but you won’t find any features beyond that.

5. Wave: Best payroll software for businesses with detailed accounting needs

Wave is a small business software known for its detailed invoicing and accounting tools. Its payroll add-on seamlessly integrates with its bookkeeping tools, keeping all your numbers in one tidy place.

For a monthly fee, Wave’s payroll add-on includes:

• Direct deposit
• Auto-remittance for taxes
• Employee access portal

‍Tech requirements or integrations:

• Available on: IOS, Android, Windows
• Uses Zapier to integrate with apps like Square, Google Sheets, and Shopify

Employee limits: None

While there are no employee limits, Wave’s payroll add-on costs $25 each month, plus $6 per active employee or independent contractor paid. If you’ve got a growing staff, it can get pricey quick.

Free payroll software limitations

Even the best free payroll software comes with trade-offs!

If you go the free route, you can expect feature limitations such as:

• Limited number of employees on payroll
• No automated tax calculations or filing
• No direct deposit
• Few integrations with accounting tools
• Minimal customer support

Free tools can work for some small businesses, but they’re rarely built to scale without a paid upgrade. Keep an eye on what your software’s paid plans look like to see if they’ll match your business’s needs as it grows.

{{banner-cta}}

Free vs. paid payroll software

Free payroll software for small businesses usually offers basic tools like paycheck calculations and recordkeeping. However, it often lacks tax filing or direct deposit, and has way less automation.

Paid payroll software meets those needs, and has even more detailed features like tax compliance tools, benefits management, and better customer support. Be realistic about your team’s needs to see if it’s worth it to invest in a paid program.

Guess what—we can give you the best of all worlds! While the Homebase Payroll add-on is paid, our Basic plan gives you scheduling tools, time tracking tools, and POS integration for free. More features, less swapping between software.

When to Upgrade from Free to Paid Payroll Software

Dragging your feet about upgrading to a paid plan? We get it, small businesses come with a tight budget—but time is money, and there comes a point where a low fee is super worth it.

Consider upgrading to paid payroll services when:

• You hire more than 5–10 employees
• You need automated tax filing (headaches at tax season are a good cue)
• Direct deposit becomes a priority
• You’re spending too much time on manual entry
• You want integrations with accounting or HR tools

Setting up free payroll software: A step-by-step guide

You don’t need to be a pro to get started with free payroll software—in fact, you want something that’s easy to use.

Here are the steps to get you started:

1. Choose a provider: Pick a trusted free payroll system that matches your needs (check out our options above!).
2. Create your account: Register your business and input company details (name, address, EIN, etc.) needed for setting up payroll.
3. Add employee information: Enter employee information including wages, tax forms like W-4s and 1-9s, and payment preferences.
4. Set pay schedules: Choose how often employees are paid (weekly, biweekly, etc.).
5. Enter hours or salaries: You can either input this manually or with integrated time-tracking tools.
6. Run your first payroll: Go time! Review, approve, and process your first pay cycle.
7. Maintain records: Seriously, do it. Keeping digital or physical records for compliance is non-negotiable when it comes to tax compliance.

Even the most simple payroll software needs accurate inputs, so double-check your work—especially if you're using DIY payroll software.

Frequently asked questions about free payroll software 

Here are some of the most frequently asked questions about doing free payroll for small businesses:

Is there a free way to do payroll?

Yes, there are free ways to do payroll. Many small business owners start with spreadsheets or a free online payroll system. These options can handle basic calculations, but don’t include many (or any!) automated features or help with tax filings.

What is free payroll software?

Free payroll software is a tool that helps businesses calculate employee wages and taxes, track hours, and manage basic payroll tasks at no cost. It typically has fewer complex features than paid payroll software.

What is the best free payroll software?

The best free payroll software depends on your business’s size and needs. Some of our top picks for online free payroll services for beginners include Homebase Payroll, Payroll4Free, and ExcelPayroll.

What does free payroll software typically include?

Free payroll software typically includes wage and hour calculations, as well as basic tax form support. For most (but not all!) software, features like automated tax filing, benefits tracking, or direct deposit typically only show up in paid versions.

Is Payroll4Free really free?

Yes, Payroll4Free is free for businesses with up to 10 employees. The paid program includes tax filing as well as direct deposit to external banks, and costs up to $40 per month.

Is Excel Payroll free?

Yes, Excel Payroll is free, and comes with templates that require manual inputs. This truly DIY payroll software for spreadsheet lovers!

How many employees can I have with free payroll software?

Most free payroll software caps users at around 20 employees. Manual offline payroll software is generally unlimited, but you sacrifice automation and more thorough features.

Using software with scalable plans or low-cost upgrades keeps you from having to swap providers as your business grows.

What happens when I exceed the employee limit?

Exceeding the employee limit on free online payroll software usually triggers a prompt to upgrade. Some platforms may pause service or prevent new employees from being added until you upgrade.

What happens to my data if I switch payroll providers?

Reputable payroll providers will allow you to export your data. Look for options that offer CSV or PDF downloads to make sure your employee and payroll history moves with you.

Making payroll work on a budget

Good payroll software doesn’t just “do the math”—it gives you back your time, your sanity, and your weekends. Whether you're after the best free option possible or affordable all-in-one software, choose the one that makes your shoulders relax.

Want to get your scheduling and timesheets streamlined alongside payroll? We’ve got you. Try two free weeks with us to see if Homebase is a fit for your small business.

{{banner-cta}}