Small businesses are often faced with the challenge of finding the right payroll tools for small businesses that fit well within their constrained budgets and regulatory demands. Entrepreneurs, startups, and freelancers often wonder: is there really such a thing as an affordable payroll software that also works well?

The answer is yes. There are several cheap payroll software solutions and online payroll services under $20/month that provide the essentials, such as employee self-service, payroll management for startups, and tax compliance payroll tools for small companies.

In this guide, we’ll discuss three of the payroll software for small businesses under $20: PayProNext, Patriot Payroll, and SurePayroll. Let’s dive in and see which option is perfect for those searching for affordable payroll tools for startups and entrepreneurs, simple payroll solutions for small business owners, and even the best payroll system for freelancers and microbusinesses.

Why Small Businesses Need Payroll Software

Payroll can be a time consuming and error prone process to many small business owners. Potential errors in calculating taxes, paying taxes late and even incorrectly classifying employees can be the result of handling the taxes manually and can land an organization in serious trouble with costly penalties. To add to this, the fluctuation of the tax rates, and the deadlines to file taxes can easily defeat the entrepreneurs who have more things to do on their plate. This is where cheap payroll software comes in. It automates calculations, is compliant, gives employees access to self-service and saves time. In the case of startups and microbusinesses, you reap the benefits of cheap payroll software being available to ensure your compliance as you can do it with no accountant involved and just use the proper software.

1. PayProNext

Why it stands out: PayProNext is one of the most affordable payroll tools for startups and entrepreneurs. It’s designed for business owners who want professional payroll without high fees.

Basic Payroll Plan: $7/month, includes unlimited payroll runs, setup, employee self-service, and reporting. Ideal for those comparing free payroll software vs paid payroll software, since for just a few dollars, you unlock real-time support and compliance tools.

Full-Service Plan: $15/month + $1.50 per employee, includes W-2/W-3 forms, federal/state/local tax compliance, direct deposit, and guaranteed on-time filing.

Best for: Startups needing tax compliance payroll tools for small companies while staying under budget.

2. Patriot Payroll

Why it stands out: Patriot is known for simple, no-frills payroll that gets the job done.

Basic Payroll: Starts at $17/month + $4 per employee. You’ll need to file your own taxes, but it covers unlimited payrolls, direct deposit, contractor payments, and reports.

Full-Service Payroll: From $37/month + $5 per employee, Patriot will file all federal, state, and local taxes for you.

Best for: Owners who don’t mind filing taxes themselves or want to explore Patriot’s lower-priced options.

3. SurePayroll (by Paychex)

Why it stands out: SurePayroll has been around for years and provides reliable payroll management for startups and small businesses.

No-Tax-Filing Plan: $20/month + $4 per employee, which gives you access to payroll scheduling, direct deposit, and reporting.

Full-Service Plan: $29/month + $7 per employee, with full tax filing support.

Best for: Companies that value brand recognition and want a top online payroll software with low monthly fees, though it may exceed the $20 budget once employees are added.

Payroll Software Comparison: Plans Under $20

Looking at the comparison table, it’s clear that for small businesses, strictly keeping payroll costs under $20/month, only PayProNext consistently fits the budget. Both its Basic plan at $7 and Full-Service plan at $16.50 (for one employee) stay well within the limit. In contrast, Patriot and SurePayroll quickly exceed $20 once employee fees are added, making PayProNext the only truly reliable payroll software under $20/month for small companies.

How to Choose Payroll Tools for Your Small Business

Payroll tools are one of the decisions that every small business should never underestimate. In determining what payroll software should suit the needs of a freelancer and entrepreneur, or any small business, consider the following:
Budget: If you are a small company and just getting started with payroll software, budget about $20/month plans.

Tax Filing: Will you prepare your own taxes or require taxes compliance payroll software tools in small business?

Employee Access: Look at payroll software that offers an employee self-service access option in order to have your employees download pay checks and tax forms themselves.

Ease of Use: Just because you’re not an accountant does not mean that you are terrible at bookkeeping, so use easy-payroll-solutions-for-non-accountants with automation.

Pro Tip: While comparing free payroll software to paid payroll software, keep in mind that free tools may not include tax filing, compliance or customer support features critical to paying no penalties to the IRS.

Final Takeaways

Best budget pick: PayProNext Basic at just $7/month.

Best full-service under $20: PayProNext Full-Service, with tax filing included.

Patriot: Good alternative, if you’re not strictly keeping costs under $20.
SurePayroll: Reliable, but not ideal if you’re strictly keeping costs under $20.

Whether you’re a freelancer, startup, or small company, these affordable payroll software options give you access to simple payroll solutions for small business owners without high monthly fees.

In short, the best affordable payroll services for businesses on a budget are out there; you just need to choose the right fit for your needs.