Figuring out payroll services pricing can feel like a maze. With base fees, per employee charges, and a whole dictionary of add ons, it’s tough to know what you’ll actually pay. While costs vary based on your specific needs, a small business with around 10 employees can typically expect to pay between $100 and $200 per month. The price on the box is rarely the final cost. This guide breaks down every component of payroll services pricing so you can budget accurately, avoid surprises, and choose the right payroll partner for your business. For a transparent breakdown of what’s included, see Bolto pricing.

Common Payroll Pricing Models Explained

Payroll providers generally use a few core models to structure their fees. Understanding these is the first step to comparing your options and decoding payroll services pricing.

Base Fee Plus Per Employee Fee

This is the most popular model in the industry, used by everyone from Gusto to ADP. You pay a fixed monthly subscription (the base fee) plus a smaller variable fee for each employee on your payroll. A typical small business might see a base fee around $40 to $50 per month, with an additional $5 to $10 per employee.

For example, if a service charges a $49 base fee plus $6 per employee, and you have 10 employees, your monthly cost is simple to calculate:

$49 + (10 employees × $6) = $109 per month.

This structure is predictable and scales cleanly with your company’s size. For comparisons across leading tools and cost ranges, read our best global payroll services guide.

Per Employee Per Month (PEPM) Pricing

PEPM is the variable part of the pricing model just described. It’s the specific amount you pay for each person each month. The typical range for a PEPM fee is between $4 and $20. A lower fee (around $4 to $6) usually covers basic payroll, while a higher fee (upwards of $15) might include bundled services like HR support or benefits administration. This model makes your costs directly proportional to your headcount.

Per Payroll Run Fee

Less common today but still used by some providers, this model charges you every single time you process payroll. The fee could be, for example, $30 per payroll run plus $2 per employee paid in that cycle.

This pricing structure can get expensive quickly if you have a frequent pay schedule. A company paying employees weekly will incur four times the run fees of a company paying monthly, which can cause costs to “sneak up on you”. However, for businesses that run payroll infrequently, it can sometimes be more economical.

Fixed Annual License and Tiered Plans

Some providers, especially those serving larger companies, offer a fixed annual license. You pay one flat fee for a year of service, which often includes a set number of employees. This can range from $1,000 to over $6,000 annually.

Many services also use tiered plan pricing. A “Basic” tier might offer core payroll, while “Premium” tiers add features like HR advisory services, multi state support, and benefits administration at a higher price point. Your employee count can also push you into a higher tier; for instance, a plan might cover up to 50 employees before requiring an upgrade.

Key Factors That Influence Payroll Services Pricing

Beyond the core pricing model, several key business characteristics will directly impact your final bill.

Number of Employees

Your headcount is the most direct driver of your payroll costs. Nearly every pricing model scales with the number of employees you pay. The more people you have, the more you’ll spend on per employee fees. The good news is that many providers offer volume discounts, where the per employee fee drops as your workforce grows. For example, a company with 75 employees might secure a rate of around $5 per person, while a smaller business pays $7.

Payroll Frequency

How often you pay your team matters. Running payroll weekly (52 times a year) is more work for a provider than running it monthly (12 times a year). If your provider charges a per payroll run fee, a weekly schedule can quadruple your base costs compared to a monthly one. Even with flat monthly pricing, some providers may require you to be on a more expensive plan to support high frequency payrolls. Biweekly is the most common pay schedule in the U.S., used by about 36% to 42% of small businesses.

Multi State Payroll

Operating in more than one state significantly adds to payroll complexity and cost. Each state has its own tax and reporting rules. Because of this, providers usually charge an extra fee for each additional state, which could be around $10 or $20 per month, or they may require an upgrade to a premium plan that includes multi state support.

For startups and remote first companies, managing this can be a headache. An all in one platform that handles compliance across all 50 states without nickel and diming you is crucial. Bolto’s U.S. payroll platform is built for this exact scenario, simplifying multi state tax filings for growing teams.

Add On Services and Software Integrations

Basic payroll often just covers wage calculations and tax withholding. Many providers offer valuable add on services for an extra fee. These can include:

• Time Tracking Integration: Often costs an additional $5 to $8 per employee each month.
• HR and Benefits Administration: Can add another $5 to $15 per employee per month.
• Software Integration: Connecting your payroll to accounting software or other tools may come with setup or monthly fees.

While these add ons increase the price, they often provide significant value by centralizing your operations. Bundling HR features with payroll is frequently cheaper than buying separate HR software—if you’re new to HR tech, start with what HRIS systems are.

Demystifying the “All In” Cost of Payroll Services

To truly understand payroll services pricing, you have to look beyond the advertised rate. The goal is to calculate your total expected cost to get a complete picture of the payroll services pricing you’ll actually pay.

How to Calculate Your Total Payroll Cost

To get a realistic budget, you need to sum up every potential charge. Your formula should look something like this:

(Monthly Base Fee) + (Per Employee Fee × Number of Employees) + (All Add On Service Fees) + (Any Per Run Fees)

Don’t forget to account for infrequent charges, like year end processing or one time setup fees, to project your annual cost accurately. It’s always a good idea to ask vendors for an “all in” quote that lists every potential fee.

Watch Out for Hidden Fees

Hidden fees are charges that aren’t advertised upfront but can inflate your bill. A seemingly low monthly price can quickly double once you add necessary services. Common hidden fees to ask about include:

• Tax Filing Service Fee: Some basic plans calculate your taxes but charge extra (e.g., $25 to $50 per month) to actually file them with government agencies.
• Year End W-2 and 1099 Processing Fee: Many providers include this, but some charge a separate fee per form at the end of the year.
• Implementation and Setup Fee: This is a one time charge, often between $50 and $200, to get your account configured. Many providers will waive this fee as an incentive, so it never hurts to ask.
• Check Printing and Delivery Fee: While over 95% of U.S. employees are paid via direct deposit, printing paper checks almost always costs extra. Expect to pay $2 to $5 per check, plus potential shipping fees.
• Direct Deposit Fee: For most modern platforms, direct deposit is included for free. However, some legacy systems or special cases (like same day payroll) can trigger fees.
• Premium Support Fee: Basic support is usually included, but getting dedicated or priority help may require an upgrade.

Outsourced vs. In House: A Payroll Cost Comparison

When evaluating payroll services pricing, it’s helpful to compare it against the true cost of running payroll yourself.

For most small and mid sized businesses, outsourcing is more cost effective. Doing payroll in house isn’t free; it costs you valuable time (often 5 to 15 hours per month) and carries a high risk of errors. In fact, about 40% of small businesses incur an average of $845 in IRS penalties each year for payroll mistakes. The average cost to fix a single payroll error is around $291.

Outsourcing converts these variable risks and time sinks into a predictable monthly fee. A typical online payroll service for a small business with around 10 employees often costs between $100 and $200 per month. When you consider that outsourcing saves an average of five hours per pay period and prevents costly penalties, the service often pays for itself. For a real‑world example of time and cost impact, see the Rebet case study.

Find Clarity in Your Payroll Costs

Understanding the different components of payroll services pricing is the key to making an informed decision. Look past the headline number and evaluate the total cost based on your company’s specific needs, from headcount and pay frequency to multi state operations and desired add ons.

For startups and growing businesses that also plan to hire abroad, explore our guide to recruiting around the world to understand cross‑border costs and compliance considerations. Get a demo to see how Bolto can streamline your operations.

Frequently Asked Questions about Payroll Services Pricing

What is a typical monthly cost for payroll services for a small business?

For a small business with about 10 employees, a typical cost for a full service online payroll provider ranges from $100 to $200 per month. This generally includes a base subscription fee plus a per employee charge.

How can I avoid hidden payroll fees?

The best way to avoid hidden fees is to ask detailed questions before signing a contract. Specifically ask if tax filings, year end W-2/1099 forms, setup, and multi state support are included in the base price or if they cost extra. Choose providers that advertise transparent, all inclusive pricing.

Is it cheaper to run payroll weekly or biweekly?

It is almost always cheaper to run payroll biweekly instead of weekly. This is because some providers charge a fee for every payroll run. A weekly schedule has 52 pay periods per year, while a biweekly schedule has 26, effectively cutting those specific fees in half.

Do I have to pay extra for W-2 processing at the end of the year?

It depends on the provider. Many modern, full service payroll platforms include year end W-2 and 1099 processing in their standard subscription fee. However, some legacy providers or budget plans may charge an additional fee per form. Always confirm this beforehand.