NB: If you’re thinking of doing it yourself, check out our guide to the best UK payroll software and be sure to peruse our handy beginners guide to UK payroll.

1. Moorepay – Best overall payroll provider

Moorepay stands at the forefront of UK payroll services, bringing over 50 years of experience to the table. Their cloud platform combines payroll and HR functions into one sleek system that makes employee data analysis feel effortless. They’ve earned CIPP’s Payroll Service Provider of the Year Award in 2023, and big names like McDonald’s and Volkswagen trust them with their payroll. Their UK-based specialists offer practical guidance on everything from basic payroll questions to complex tax matters. Small businesses particularly love their free holiday calculators that quickly figure out leave entitlements for part-time and zero-hour workers.

Advantages:

• CIPP Payroll Assurance Scheme accredited
• Strong customer support via phone and live chat
• Comprehensive HR integration
• Free holiday calculators
• Custom reporting capabilities

Limitations:

• No international payroll support
• Lacks live training sessions
• Pricing only available through quotes
• No chatbot support

2. Payescape – best for short-term Contracts

Payescape takes a different approach with their rolling monthly contracts – perfect if you’re not ready for a long-term commitment. Based in Ballymoney, Northern Ireland, they’ve built their reputation on making payroll straightforward for small businesses since 2006. Their three-ring phone answer policy means you won’t wait long for help, and they’ve packed their knowledge center with video tutorials and how-to guides. Their team all holds CIPP qualifications, so you know you’re in good hands.

Advantages:

• Flexible rolling monthly contracts
• CIPP-qualified support team
• Strong integration with accounting software
• Custom reporting options
• Comprehensive training resources

Limitations:

• No international employee payments
• Limited payroll changes reporting
• Single office location may limit access
• No face-to-face support outside NI

3. MHR – best for reporting

MHR brings serious muscle to payroll reporting with their iTrent software, winner of CIPP’s Software Product of the Year 2023. They excel at turning complex employee data into clear insights – something Microsoft Azure and Experian have noticed. Their visualization tools make presenting performance data to stakeholders a breeze. They operate from Nottingham and Glasgow, offering solid phone and chat support.

Advantages:

• Advanced reporting and analytics
• Strong data sharing capabilities
• Comprehensive compliance tools
• Award-winning iTrent platform
• Multiple UK office locations

Limitations:

• No live training sessions
• Limited compliance guidance
• Complex interface for beginners
• Pricing requires custom quotes

4. Frontier – best for international business

Frontier steps up for international businesses, handling payroll across 26 countries. With offices spread across Surrey, Warrington, Nottingham, and Gloucester, they’re within reach for many English businesses. Their mobile app lets employees submit timesheets and check payslips on the go.

Advantages:

• Handles international payroll
• Live training available
• Multiple UK locations
• Strong mobile app functionality
• CIPP PAS accredited

Limitations:

• No open API for integrations
• Limited compliance advice
• No chatbot support
• Complex implementation process

5. OneAdvanced – best for training

OneAdvanced shines in the training department. They support over 22,000 customers globally and offer various learning formats – live sessions, video tutorials, and written guides. With nine UK offices, including one near London City Airport, they’re never far away. They handle complex salary structures and multiple payroll interfaces with ease.

Advantages:

• Comprehensive training program
• CIPP-accredited expert advice
• Extensive UK office network
• Custom reporting capabilities
• Strong phone and chat support

Limitations:

• No open API
• Lacks mobile app
• No chatbot assistance
• Complex system navigation

6. ADP – best for security

ADP brings serious security credentials to the table. This industry veteran has claimed the Global Payroll Supplier of the Year award two years running and dominated the CIPP Annual Excellence Awards for four straight years. Their mobile app doubles as a clock-in system – perfect for managing rotating shifts. They maintain offices in Staines-upon-Thames and Cheadle, though pricing details remain under wraps.

Advantages:

• Strong security protocols
• Robust mobile app with clock-in
• Custom reporting features
• Tax education resources
• International capabilities

Limitations:

• Limited payroll change reporting
• No transparent pricing
• No chatbot support
• Email support not available

7. TopSource – best for native integrations

TopSource rounds out the top providers with their comprehensive service suite. From their Birmingham base, they handle everything from HMRC registration to year-end processing. Their native platforms cover HR, recruitment, and benefits management, with ready-made integrations for popular accounting software like Sage and Xero. They’ll process international payroll too, though their reporting lacks customization options.

Advantages:

• Comprehensive native software suite
• Strong compliance tools
• International payroll capability
• Ready-made accounting integrations
• ISO 27001 certified

Limitations:

• No custom reporting
• Limited training options
• Single UK office location
• No transparent pricing structure

Each provider sets their prices based on your specific needs – employee count, pay frequency, and extra features all play a part in the final quote. Most won’t publish standard rates, so you’ll need to contact them directly for accurate pricing. Small businesses might want to check out Iris Staffology, who buck this trend by advertising their prices upfront.

UK managed and outsourced payroll services FAQs

What is a managed or outsourced payroll service?

A managed payroll service takes over your company’s entire payroll operation. They’ll handle everything from processing payments and generating payslips to dealing with HMRC as your PAYE-registered agent. Think of them as your dedicated payroll department, just sitting in a different building.

How does managed payroll work?

Once you’ve partnered with a payroll provider, they’ll use their specialist software to process your payroll in line with your staff contracts. They’ll make sure everyone gets paid the right amount at the right time, handle all the paperwork, and keep you compliant with tax and employment laws. You’ll still have oversight of the process – most providers let you review everything before payments go out.

What are the benefits of outsourcing payroll?

Money and time are the big ones. You won’t need to hire in-house staff or buy expensive payroll software, and the service typically costs less than maintaining an internal team. Plus, you’ll free up time you’d otherwise spend on admin tasks. The providers also keep up with all the latest tax and employment law changes, so you don’t have to worry about accidentally missing something important.

What are the downsides of outsourcing payroll?

Some companies worry about losing control of their payroll process or sharing sensitive employee information. A good provider will address these concerns by letting you review everything before it’s finalized and showing you their information security certifications (look for ISO27001). You’ll also want to check if their systems can work smoothly with your existing HR and finance software.

How do pensions (workplace, auto-enrolment) work with managed payroll?

Your payroll provider will typically handle all the pension-related admin, including auto-enrolment requirements. They’ll figure out which workers are eligible, calculate the right contributions, and either give you reports for your pension scheme or upload them directly to the relevant pension portals.

How much does managed or outsourced payroll cost?

Most UK providers charge per payslip rather than a flat fee. This means your costs scale with your business size, which often works out cheaper than maintaining an in-house team. You’re not just paying for processing – you’re also getting protection against compliance penalties, which can be expensive if you make mistakes handling payroll internally.

Is outsourced payroll mainly for big companies, or do small businesses use it too?

Companies of all sizes use managed payroll services. There’s no minimum or maximum number of employees required. Whether you have five employees or five thousand, you can benefit from the time savings and expertise these services provide. In fact, smaller companies often find it especially helpful since they might not have the resources to maintain a dedicated payroll department.

The post Top UK Managed and Outsourced Payroll Services Companies – 2025 Guide appeared first on Compare Business Bills.

If you’re new to payroll, see our beginner’s guide to small business payroll.

If you’re looking to outsource your payroll, check out our recommendations for managed payroll providers.

1. BrightPay

BrightPay serves small to medium UK businesses with a straightforward interface and solid HMRC compliance features. The platform handles everything from basic payroll to auto-enrollment pension schemes.

Advantages:

• Clean interface with minimal training needed
• Comprehensive HMRC compliance features
• Competitive pricing for small businesses
• Strong pension auto-enrollment support

Limitations:

• Limited international operations capabilities
• Basic reporting features
• Mobile app needs improvement

2. Sage

Sage excels through its deep accounting integration and makes payroll management feel natural for existing Sage users. The platform offers robust reporting capabilities and stays current with UK tax requirements.

Advantages:

• Seamless accounting integration
• Powerful customizable reporting
• Strong UK tax compliance tools
• Grows with your business

Limitations:

• Takes time to learn the system
• Higher costs for small businesses
• Complex interface for basic users

3. QuickBooks Payroll

QuickBooks Payroll brings automation and accounting integration together. The software handles tax calculations and payroll runs smoothly, though you’ll pay extra for some advanced features.

Advantages:

• Strong QuickBooks integration
• Automated tax calculations
• User-friendly dashboard
• Real-time payroll processing

Limitations:

• Premium features cost extra
• Basic standalone payroll features
• Inconsistent customer support

4. Xero Payroll

Xero combines accounting and payroll in one platform, offering real-time insights into your business finances.

Advantages:

• Real-time financial data
• Smooth accounting integration
• Simple employee self-service
• Regular UK tax updates

Limitations:

• Limited payroll features compared to specialists
• Complex pay structures can be difficult to set up
• Basic reporting options

5. FreeAgent

FreeAgent targets freelancers and small businesses with straightforward payroll management alongside VAT and self-assessment tools.

Advantages:

• Perfect for small businesses
• Built-in UK tax compliance
• Clear, simple interface
• Fair pricing structure

Limitations:

• Limited features for larger companies
• Basic customization options
• Simple reporting tools

6. Gusto

Gusto combines payroll and HR features in a modern, user-friendly package.

Advantages:

• Clean, intuitive interface
• Strong benefits management
• Excellent customer support
• Comprehensive HR tools

Limitations:

• Expensive for small teams
• Some UK features lag behind US version
• Additional costs for advanced features

7. ADP Workforce Now

ADP targets medium to large businesses with powerful features and deep customization options.

Advantages:

• Extensive customization capabilities
• Strong compliance management
• Advanced reporting tools
• Handles complex organizations well

Limitations:

• Overwhelming for small businesses
• Steep learning curve
• Premium pricing

8. Paychex Flex

Paychex Flex offers flexible payroll options with strong mobile support for businesses of all sizes.

Advantages:

• Mobile-friendly design
• Flexible payment options
• Good scalability
• Strong compliance tools

Limitations:

• Complex interface
• Variable customer support
• Higher pricing tiers

9. Rippling

Rippling integrates payroll, IT, and finance tools in one platform, with strong support for international teams.

Advantages:

• Unified platform approach
• Strong IT integration
• Global payroll support
• Automated workflows

Limitations:

• More features than small businesses need
• Premium pricing
• Complex setup process

10. OnPay

OnPay keeps things simple with straightforward pricing and solid automation features.

Advantages:

• Clear pricing structure
• Automated tax filing
• Good customer support
• Easy setup process

Limitations:

• Basic features only
• Limited customization
• Simple reporting tools

11. Paycor

Paycor transforms payroll data into actionable insights. Their reporting tools help businesses make smarter decisions about their workforce spending.

Advantages:

• Comprehensive analytics dashboard
• Easy-to-generate custom reports
• Strong compliance monitoring
• Built-in time tracking features

Limitations:

• High cost for small teams
• Complex feature set can overwhelm
• Time-consuming implementation

12. Wave Payroll

Wave Payroll keeps things affordable while delivering reliable payroll processing and clean accounting integration.

Advantages:

• Budget-friendly pricing
• Clear accounting integration
• Straightforward setup
• No hidden fees

Limitations:

• Basic feature set
• Limited customization options
• Minimal HR tools

13. Deel

Deel tackles international payroll challenges head-on, making global team management smoother.

Advantages:

• Multi-country compliance built-in
• Handles international payments efficiently
• Strong contractor management
• Built-in legal compliance

Limitations:

• Higher costs for small teams
• Focused solely on global/remote teams
• Complex pricing structure

14. Remote Payroll

Remote Payroll specializes in managing distributed teams across borders with solid compliance features.

Advantages:

• Strong international compliance
• Local law expertise
• Easy payment distribution
• Good employee self-service

Limitations:

• Expensive for small operations
• Limited domestic-only features
• Complex setup process

15. Paylocity

Paylocity combines modern payroll features with comprehensive human capital management tools.

Advantages:

• Strong performance tracking
• Modern user interface
• Mobile-first approach
• Deep HR integration

Limitations:

• Requires significant setup time
• Higher pricing tiers
• Can feel overwhelming

16. Papaya Global

Papaya Global excels at handling multi-currency payroll across different countries.

Advantages:

• Excellent currency management
• Strong compliance tools
• Real-time payment tracking
• Built-in tax calculations

Limitations:

• Premium pricing model
• Complex implementation
• Overkill for domestic-only businesses

17. Ceridian Dayforce

Ceridian Dayforce connects workforce management with payroll processing for larger organizations.

Advantages:

• Deep workforce analytics
• Strong scheduling tools
• Real-time calculations
• Comprehensive reporting

Limitations:

• Significant implementation time
• High costs
• Complex system architecture

18. Zoho Payroll

Zoho Payroll delivers straightforward payroll management with solid Zoho product integration.

Advantages:

• Affordable pricing tiers
• Clean Zoho integration
• User-friendly interface
• Automated calculations

Limitations:

• Basic feature set
• Limited third-party integrations
• Simple reporting tools

19. SurePayroll

SurePayroll focuses on flexible payroll options backed by reliable customer support.

Advantages:

• Multiple payment schedules
• Strong mobile access
• Good customer service
• Easy tax filing

Limitations:

• Basic HR features
• Limited customization
• Simple reporting options

20. BambooHR

BambooHR emphasizes employee experience while handling core payroll functions through integrations.

Advantages:

• Strong employee focus
• Good performance tracking
• Clean user interface
• Solid HR tools

Limitations:

• Relies on third-party payroll
• Higher costs
• Limited payroll features

Don’t forget to take advantage of free trials to test the features that matter most to your operation. Never assume that the cheapest option is the most cost-effective in the long run – factor in the time your team will spend learning and using the system.

HMRC recognised free payroll software

Yes, there are a number of free options (including HMRC’s free payroll tool) for use up to 10 employees.

HMRC recognised paid payroll software

The following are all the paid options for UK payroll that are officially recognised by HMRC.

Things to consider when choosing payroll platform or software

Is the payroll software easy to use?

Start by checking how user-friendly the software feels. You want your payroll team to move through the system without getting lost in complex menus or spending ages hunting for basic functions. Think of it like a well-organised kitchen – everything should be right where you expect it.

Can employees change or update their details themselves on the payroll platform?

Employee self-service makes a big difference. Your staff should be able to update their own bank details and access their pay information. This keeps your HR team from getting bogged down with simple requests, letting them focus on more important work.

Can the payroll platform scale with your business?

Think about your company’s future when choosing software. You need a system that can handle your current team and grow alongside your business. A system that works perfectly for 50 employees might struggle with 500, so plan ahead.

How sophisticated is the payroll software? What manual tasks can it automate?

Automation is where payroll software really shines. The more tasks it can handle without human input, the better. Look for software that can automatically calculate wages, apply tax changes, and handle regular payments. Even better if it connects with your time tracking system – this creates a smooth flow from hours worked to payslips issued.

What security standards does the payroll platform have? (e.g. ISO 27001 or SOC2)

Security needs special attention. Your payroll data includes sensitive personal and financial information, so make sure any software you consider takes security seriously. Ask about encryption, access controls, and how they protect data during transfers. Ask about information security standards like ISO 207001 and/or SOC2.

Cloud hosted vs self hosted payroll software

Consider whether cloud-based or self-hosted software suits your needs. This often depends on your IT setup and expertise. Cloud systems offer easier access and automatic updates, while self-hosted solutions give you more control over your data.

What are the payroll reporting features?

The software should make it easy to analyse your payroll data and create reports. You want clear dashboards and simple ways to extract information for both government requirements and internal planning. Good reporting helps you spot trends and make better decisions about your workforce costs.

How customisable is the platform?

Look for customisation options. Every business handles payroll slightly differently, so you need software that adapts to your specific needs rather than forcing you to change your processes to fit the software.

What is the level of customer support?

Finally, check out the customer support. Problems with payroll can cause serious headaches for everyone involved, so you want responsive support that can help solve issues quickly. Ask about support hours, response times, and how they handle urgent problems.

What can payment software do for my business?

Great payroll software should handle these key tasks for you:

• Calculate and process everyone’s pay automatically, handling different pay rates and schedules for your whole team
• Keep up with tax regulations and automatically apply the latest rates and rules for things like income tax and benefits
• Connect with HMRC to report your payroll data and stay compliant with filing requirements
• Give employees secure access to view their pay history and download their own payslips
• Track and manage employee benefits, including pension contributions and health insurance deductions
• Process expense reimbursements and handle special payments like bonuses or commissions
• Create detailed reports showing your labour costs, tax payments, and other payroll metrics
• Integrate with your accounting software to keep your books accurate and up-to-date
• Store all your payroll records securely and maintain an audit trail of changes
• Manage time off and leave balances, including vacation time and sick days
• Handle multiple pay frequencies if you have both weekly and monthly paid staff
• Calculate overtime pay and shift differentials automatically based on your rules
• Keep track of salary history and pay changes over time for each employee
• Support direct deposit payments and generate payment files for your bank

The post Top 20 UK Payroll Software Platforms – 2025 Guide appeared first on Compare Business Bills.

If you’re after payroll software, check out our guide to the best UK payroll software.

If you’re considering outsourcing your payroll to a managed payroll company, check our guide to the best payroll services companies.

Getting started with PAYE

You’ll need to set up PAYE (Pay As You Earn) before you can start paying employees. Think of PAYE as your direct line to HMRC – it’s how you’ll collect and send income tax and National Insurance from your employees’ wages. Head over to HMRC’s website to register as an employer and get your PAYE login details. If this sounds daunting, don’t worry – many payroll providers can handle the setup process for you.

When your new employee starts, ask them for their P45 from their previous job or have them complete HMRC’s starter checklist. You’ll use this information to work out their tax code. Make sure to get their National Insurance number too – you can’t process payroll without it.

The monthly payroll cycle

Payroll follows a steady rhythm. Every payday, you’ll need to calculate your employee’s pay and work out any deductions. These might include income tax, National Insurance, student loan repayments, or pension contributions.

You’ll need to report these payments and deductions to HMRC through what’s called Real Time Information (RTI). This means sending a Full Payment Submission every time you pay an employee – no delays or batching allowed. Think of it as keeping HMRC in the loop as things happen, not after the fact.

For monthly payments, you’ll need to send the money you’ve deducted to HMRC by the 22nd of the following tax month. If you’re paying quarterly, mark your calendar for the 22nd after the quarter ends.

National Insurance and Employment Allowance

As an employer, you’ll need to pay employer’s National Insurance contributions for your staff. The rates change from year to year – for 2024/25, you can find the current rates on the government website. Here’s some good news though: the Employment Allowance lets eligible employers reduce their National Insurance bill by up to £10,000 in the 2025/26 tax year. This can make a real difference to your bottom line.

Workplace pensions/autoenrolment

Setting up a workplace pension isn’t optional anymore – even if you only have one employee. If they’re eligible, you’ll need to enroll them automatically. The rules around workplace pensions can feel complex, but getting it right matters. The Pensions Regulator can issue fines if your scheme isn’t up to scratch.

Got seasonal workers or temporary staff? You can use something called postponement to delay enrolling them for up to three months. This can save you some administrative headaches if you’re taking on short-term workers.

Keeping the correct payroll records

Think of your payroll records as your safety net. Keep track of everything: what you’ve paid your employees, what you’ve deducted, reports to HMRC, employee sick days, tax codes – the works. You’ll need to hang onto these records for three years after the tax year they relate to. HMRC might want to check them during a PAYE compliance check.

Speaking of compliance checks, HMRC might pop by to make sure everything’s in order. They’ll typically want to visit your premises and look through your payroll records. If you’re a member of the Federation of Small Businesses, you can get help with these investigations through their Tax Investigation Protection service.

What to do when an employee leaves

When an employee leaves, you’ll need to tell HMRC straight away. Update their payroll record with their leaving date, make any final deductions in your next Full Payment Submission, and give them their P45. Don’t forget about any holiday pay they’ve accrued – you’ll need to either let them take it or pay them for it.

UK National Insurance categories for payroll

Category A covers most of your regular employees. If you’ve got someone earning more than £242 a week and they’re under state pension age, they’ll fall into this group. Simple enough, right? Well, hang on, because it gets more interesting.

Category B doesn’t see much action these days. It’s for married women and widows who opted for reduced rates before 1977. Yes, 1977! A few people still qualify for this, though they’re getting pretty rare now.

Then there’s Category C – you’ll use this for employees over state pension age. They don’t pay NI contributions anymore, but you still need to record them under this category. Makes sense when you think about it – they’ve paid their dues.

Category F is where things get maritime. It covers merchant navy crew members, because apparently sailors need their own special category. Honestly, I’ve processed payroll for years and never once used this one, but it exists!

Category M is interesting – it’s for employees under 21. The government introduced this to make it cheaper for employers to hire young people. Smart move really, saves businesses some cash while giving young folks a leg up.

Category H works like Category M but for apprentices under 25. The government really wants to encourage businesses to take on apprentices, so they created this special rate. You’ll need to keep an eye on their 25th birthday though – that’s when they usually bump up to Category A.

If you’ve got someone serving in the armed forces, they’ll fall under Category N. Not something most payroll folks deal with, but worth knowing about.

And then there’s Category X – this one’s a bit sneaky. It covers employees who don’t have to pay NI (like certain religious groups), but you still need to report their earnings.

The rates change pretty regularly (thanks, Chancellor!), but the categories themselves tend to stick around. You’d think they might simplify it all one day, but I wouldn’t hold my breath. At least knowing these categories helps make sense of all those letters HMRC keeps throwing at us.

Hey, I should mention Category V and Category Z too – they’re for company directors. Z is for directors under 21, and V is for any other age. Can’t forget about the bosses, right? Though why directors need their own categories is anyone’s guess. One of those HMRC mysteries, I suppose.

Remember when they introduced Category L for deferment cases? No? That’s because hardly anyone ever uses it. But it’s there, lurking in the background like that one obscure tax rule everyone forgets about until audit time.

Making payroll easier to manage

Running payroll can eat up your time if you try to handle everything yourself. Many small business owners find that working with a payroll provider frees them up to focus on growing their business. These providers can handle the technical bits while you focus on what you do best – running your company.

Remember, getting payroll right isn’t just about ticking boxes – it’s about taking care of your team and keeping your business running smoothly. Take your time to set things up properly from the start, and don’t be afraid to ask for help when you need it.

Have questions about specific aspects of payroll? Just remember that HMRC and professional payroll providers are there to help you get it right. You’re not alone in figuring this out – every successful business has been exactly where you are now.

UK payroll calendar dates to remember

UK payroll process flow chart

flowchart TD
    A[Hire First Employee] --> B[Register as Employer]
    B --> C[Get PAYE Reference]
    C --> D[Choose Payroll Method]
    
    D -->|Software| E[Pick Compatible System]
    D -->|Basic Tools| F[HMRC Basic PAYE]
    E & F --> G[Set Up Employee]
    
    G --> H[Get Tax Code]
    G --> I[Check NI Category]
    G --> J[Student Loan Status]
    
    H & I & J --> K[Monthly Tasks]
    K --> X{New Starter?}
    X -->|Yes| Y[Get P45]
    X -->|No P45| Z[Use New Starter Checklist]
    
    Y & Z --> L[Run Payroll]
    L --> M[Generate Payslips]
    M --> N[Submit RTI]
    N --> O[Pay HMRC by 22nd]
    
    L --> AA{Employee Leaving?}
    AA -->|Yes| AB[Process Final Pay]
    AB --> AC[Issue P45]
    AA -->|No| O
    
    K --> P{Any Changes?}
    P -->|Salary| Q[Update Records]
    P -->|Benefits| R[Adjust Tax Code]
    P -->|Details| S[Update Employee Info]
    
    Q & R & S --> T[Annual Tasks]
    T --> U[P60s by 31st May]
    T --> V[P11D by 6th July]
    T --> W[Update Tax Codes]
    
    T --> AD[Review]
    AD --> AE[Benefits in Kind]
    AD --> AF[Salary Review]
    AD --> AG[NI Categories]

The post Managing UK Small Business Payroll – Beginner’s Guide 2025 appeared first on Compare Business Bills.