Payroll service for a small business typically costs between $39 and $80 per month in base fees, plus $6 to $12 per employee per month, plus $40-$60 for one-time state registration per state of operation.
Total realistic monthly bill for 5 W-2 employees runs $80-$180; for 20 employees it runs $200-$360; for 50 employees $400-$700.
Rippling is the modular alternative ($40/month base + $8/employee for the core platform, with Payroll as a quote-priced add-on).
The headline price is rarely the price you pay.
Most providers structure fees around a base plan and add separate fees per employee, per state, per contractor, per W-2 reprint, and per quarter of tax filings amendments.
The only way to predict your true monthly bill is to calculate it against the four dimensions that actually drive cost: number of W-2 employees, number of contractors, number of states, and any premium-tier feature you need (dedicated support, benefits admin, time tracking).
Payroll service cost is a base monthly fee plus per-employee fee plus per-state fee plus add-ons. Pick a plan that fits at your current employee count, then plan an upgrade path as you cross 25 employees or expand to a third state of operation.
Key facts: The cheapest credible full-service plan is Gusto Simple at $40/month base + $6/employee (effective $70/month for 5 employees).
OnPay runs $49/month flat + $6/employee (effective $79/month for 5).
QuickBooks Payroll Core starts at $50/month base + $5/employee for the self-service tier and $88/month base + $12/employee for the Premium full-service tier.
Patriot Full Service is $37/month base + $5/employee.
Rippling’s published $8/employee + $40 base covers the platform; Payroll is quote-only.
5 W-2 employees full service typical bill: $80 to $180 per month. That’s $40 base + $6/employee + $20 average state fees + $0 typical add-on for the Gusto Simple plan = $90, all-in. 20 W-2 employees: $200 to $360 per month. 50 W-2 employees: $400 to $700 per month. Above 50 employees, PEO quote (Justworks) becomes cheaper than full service per employee.
Per-plan fees for the seven credible providers, October 2026
The plans below are full-service entry tiers as published on each vendor’s pricing page. Numbers are the publicly listed monthly fee plus the per-employee fee. State registration fees, premium-tier upgrades, and add-on costs are listed separately.
| Provider / Plan | Base monthly | Per employee | Per state setup | Effective at 5 employees | Effective at 20 employees |
|---|---|---|---|---|---|
| Gusto Simple | $40 | $6 | $39 per state | $70 | $160 |
| Gusto Plus | $80 | $12 | $39 per state | $140 | $320 |
| OnPay | $49 | $6 | $0 included | $79 | $169 |
| QuickBooks Payroll Core (self-svc) | $50 | $5 | $0 self-service | $75 | $150 |
| QuickBooks Payroll Premium | $88 | $12 | $0 included | $148 | $328 |
| Patriot Full Service | $37 | $5 | $0 included single state | $62 | $137 |
| ADP RUN | $79 | $15 | $40 per state typical | $154 | $379 |
| Paychex Flex | $65 | $15-$25 | $40 per state typical | $140-$190 | $365-$565 |
| Rippling (core + Payroll) | $40 | $8 (Payroll quote-only) | included | $80 + Payroll quote | $200 + Payroll quote |
For the full-service scope (what each plan tier includes and excludes line by line), the full service payroll page walks the included-and-excluded list. For the broader payroll definition and why the math works the way it does, the what is a payroll service page walks the gross-to-net and the deposits.
What your effective bill looks like at each employee count
Three realistic profiles for a single-state small business with no contractors. Each profile shows the effective monthly bill at the entry-tier Gusto plan.
1 W-2 employee (just hiring your first). Gusto Simple $40 + $6 = $46/month. Add $39 one-time state registration if the employee is in a state you haven’t registered for yet. Effective Year 1: $591.
5 W-2 employees (small team, single state). Gusto Simple $40 + $30 = $70/month. Already registered. Effective Year 1: $840.
20 W-2 employees (real small business, 1-3 states). Gusto Simple $40 + $120 = $160/month. Multi-state adds $60-$120 in monthly ongoing state fees. Effective Year 1: $2,520.
50 W-2 employees (mid-small business, multi-state common). Gusto Plus $80 + $240 = $320/month base, plus multi-state fees. Full service above 30 starts to lose economic sense vs a PEO. Re-quote with a PEO at this size.
What you might pay above the headline
The base + per-employee number is the floor, not the ceiling. The five categories of additional cost are predictable if you know they exist.
State registration (one-time). The first time your business hires in California, Texas, New York, Florida, or any new state, the provider registers you with the state tax agency. Fees: Gusto $39/state, OnPay $0 included (no fee), QuickBooks Payroll $0 included, ADP RUN by quote ($50-$150/state). Most providers allow up to 30 days for state approval before you run first payroll there.
1099 contractor coverage. Most providers include 1099-NEC preparation and filing in the standard tier. ADP RUN charges an extra monthly fee ($5-$10) for contractor-only access. Patriot Full Service includes 1099-NEC preparation but charges separately for filer-only states.
HR add-on. Gusto HR Support is $40/year per employee. QuickBooks HR Support is by quote. Payroll + HR is the more common bundle than payroll alone for teams above 10 employees.
Time tracking integration. Gusto Time Tracking is $5/employee/month extra beyond the entry tier. Most providers offer time-tracking as a separate add-on; some include basic time tracking in the full-service tier.
Premium tier upgrade. The premium tier unlocks dedicated support, hour-1 phone response, custom workflow, and proactive compliance alerts. Premium tiers cost $40-$50/month more than the entry tier; the value is mostly operational for owners who are not payroll people.
The cost math that the pricing page hides
Three hidden numbers that change the cost conversation.
Premium tier vs entry tier break-even. Premium tier is $40-$50/month more than entry tier. At 5 employees the upgrade is $40 against 5 hours of saved time per month (worth $200 if your time is $40/hour). For almost all small businesses above 5 employees, the premium tier pays for itself in month 3.
Per-employee fee scaling at 25 and 50. Some providers tier the per-employee fee: under 25 employees $6/employee, 25-50 $5/employee, over 50 $4/employee (or the reverse as a volume discount). Verify the tier table before signing; the published per-employee fee may be the entry rate, not your rate at your size.
State online vs paper filing upcharge. Most providers charge an extra $5-$15 per state per month to file state withholding returns online rather than on paper. In 2026, almost every state mandates electronic filing; the paper surcharge is rarely a real choice, but verify it’s in the markup rather than an unbilled line item.
What self-service saves
Self-service is materially cheaper than full service at the same employee count, and the savings cover the operational cost of doing the filings yourself for almost any owner with 1-3 employees.
| Plan | 5 employees | What you do |
|---|---|---|
| Patriot Software Basic (self-service) | $17 + $20 = $37/month | Calculate, deposit, file Form 941, file Form 940, generate W-2s yourself |
| Gusto Simple (full service) | $70/month | Approve the pay run |
| QuickBooks Payroll Core (self-service) | $75/month | Calculate, deposit, file forms yourself |
| QuickBooks Payroll Premium (full service) | $148/month | Approve the pay run |
The dollar gap at 5 employees between self-service Patriot ($37/month) and full-service Gusto Simple ($70/month) is $33/month or $396/year. The time investment to do the filings yourself is typically 6-10 hours per month for an owner-operator. The 33/month gap is usually not worth the 6-10 hours when you’re growing.
The honest traps that change the cost equation
Three recurring traps that come up at the cost decision moment.
Trap 1: advertised “starting at” is the cheapest tier only. Gusto Simple starts at $40 + $6. The “starting at” excludes state registration, premium tier, and per-employee fees. Always calculate the bill at your employee count, not from the marketing line.
Trap 2: per-state fees compound silently. If you grow from 1 state to 4 states over 12 months, your state-fees line on the invoice goes from $0 to $300-$500/month without any change in employee count. Plan this before expanding; it can flip a flat-fee plan into a hidden-multiplier plan.
Trap 3: self-service surcharge on a later tier. Starting on Patriot Basic ($17/month + $4/employee) at 3 employees, then upgrading to Patriot Full Service at month 6 because you’ve heard the full service is worth it. The upgrade is $37/month + $5/employee (base) at the time of upgrade; check whether the upgrade resets your billing cycle or runs double.
Pick the plan that fits your employee count and growth path
The decision follows three rules of thumb.
Pick self-service if you have 1-3 W-2 employees and have a finance person who has the time to make deposits and file forms. Patriot Basic at $17 + $4/employee is the standard sub-$50/month option.
Pick entry-tier full service if you have 1-30 W-2 employees and don’t have a dedicated payroll person. Gusto Simple at $40 + $6/employee is the standard sub-$150/month option for small business full service.
Pick premium tier or PEO if you have 25-100+ employees, multi-state operations, or you want benefits access that requires scale (group health, 401k plans). Justworks PEO at $56-$149/employee and ADP RUN at $79 + $15 are the typical choices.
For the per-vendor comparison at each tier and what each provider’s full service does and does not include line by line, the best payroll service for small business comparison goes through the math at each employee count.
For the full-service scope definition, the full service payroll page walks through the included-and-excluded list.
For the Rippling side-by-side with Gusto at the entry-tier-plus-payroll level, the Rippling vs Gusto page runs the modular vs unified comparison.
Last updated: October 2026
