The key to overcoming many of these problems is investing in the right technology. Employers in the UK need secure, convenient, and HMRC-compliant payroll solutions that allow them to pay team members on flexible schedules, to easily generate payslips, and to report PAYE information to the tax authorities. 

The challenge is, there are now so many payroll software options available, it can be difficult to determine which solution is the best fit for your business. Today, we’ll take a look at some of the most powerful and valuable payroll management tools that are worth considering in 2024.

What to Look for When Choosing a Payroll Management Tool

There’s no one method for selecting payroll management software that works for all companies. Every business situation is different, with specific challenges and goals to consider. However, there are some criteria that all organisations would do well to take into account when looking into available options. 

We curated this list of the best payroll management tools for 2024 by focusing on:

• HMRC compliance: Compliance with HMRC standards is by far the most important factor to consider when selecting payroll management software. We looked exclusively at payroll software recognised by HMRC when creating this list. 
• Pricing: Transparent pricing is crucial when maintaining your business budget. Make sure you’re aware of the monthly subscription cost for the software, as well as any additional service fees you may incur. 
• Features: Comprehensive payroll features are a must. Depending on your business, you may need a solution that supports reporting, tax calculation, employee self-service portals, pension deduction and filing, and integrations with other systems you use. 
• Ease of use: Search for a solution that simplifies the complexities of payroll management, with extensive automation, mobile access, and customization options. The easier the technology is to use, the better for your business.
• Customer service: An excellent payroll management software solution will be backed by a team of technical experts ready to offer support with any issues you may face when using your software. 

8 of the Best UK Payroll Management Tools for 2024

Finding the right payroll management software can seem like a daunting task, particularly with so many different options to choose from. Based on the criteria above, we selected 8 of the best payroll management options available to UK business leaders this year. Let’s dive in.

#1. Pento: Best for Extensive Automation

For UK businesses in search of simplicity, Pento is one of the most valuable payroll management tools available. It can streamline your payroll processes in seconds, automating repetitive tasks, and saving your business both time and money. With Pento, you can automate employee data imports, payroll calculations, edit pay until payday, automate employee payouts and HMRC payments, and more.

Additionally, the solution ensures you can stay compliant with HMRC guidelines, by automatically updating employee tax codes, reporting on benefits, and educating your finance team. As an added bonus, Pento integrates with the top tools business leaders already use, such as BambooHR, NetSuite, QuickBooks, and NEST. 

Key features:

• Comprehensive automation for all payroll calculations
• Complete control over data and reports
• Automated payouts and HMRC payments
• Detailed breakdowns of all reports
• Expert onboarding team and technical support
• Support for monthly, weekly and flexible payroll cycles 
• Pento promises simple and straightforward pricing, with no hidden extra fees. The basic solution starts at as little as £5 per month per employee, with custom quotes available for advanced needs. 

Pros:

• Extensive automation to save you time on payroll
• Complete control over your data and reports
• Integration with leading business tools
• Expert assistance and phenomenal customer support
• Complete syncing with HMRC

Cons:

• Full focus on payroll (other solutions include accounting)

#2. Sage Payroll: Best for Small Businesses

Similar to Pento, Sage Payroll is an automated software solution, but Sage is focused purely on the needs of small and mid-sized businesses in the UK. The cloud-based offering comes with helpful features such as year-round expert support, and a four-step pay run process. 

Sage Payroll plans also include features for payslip generation, pension filing, leave management, and shift scheduling. However, you will need to consider upgrading to more advanced packages as your business begins to grow. Initial plans only include payroll and HR management for up to five employees, and every extra employee will add to your pricing. 

Key features:

• Employee P60s and payslips
• Payroll and HR management in one ecosystem
• Timesheet reports and overtime management
• Mobile employee shift swapping
• Historical and real-time reports
• Sage Payroll starts from around £10 per month per employee, with a free trial of three months for beginners. Each additional employee over five staff members costs an extra £2 to £6 depending on your plan. 

Pros:

• HMRC recognised solution
• Automation for most payroll needs
• Simple setup and data import
• Native integrations with Sage’s accounting tools
• Automatic employee pension enrolment

Cons:

• Expensive for businesses with more than five employees
• Slight software learning curve for new users

#3. Rippling: Best all-in-one HR Software

Rippling is a comprehensive solution for HR management that combines tools for payroll, benefits, device management, expenses, and more into one ecosystem. With this toolkit, employers can complete payroll runs in minutes, using advanced automation to streamline repetitive tasks. 

Rippling doesn’t just address payroll needs, it also offers a complete solution for corporate card management, applicant tracking, and compensation management. However, each module does come with additional fees to consider. On the plus side, there are no extra fees for additional employees, which sets Rippling apart from competitors like Sage. 

Key features:

• HMRC compliant payments and tax filing
• Minimum wage, overtime, and holiday tracking
• Payslip and report generation and filing
• Integrations with third-party accounting software
• Wide range of modules for HR management
• Rippling requires customers to build their ideal packages from scratch and request a custom quote for their services. This can make the pricing a little complicated to understand. Most modules require a per-user fee, starting at £7 per month per user. 

Pros:

• Highly customisable and modular packages
• Automated custom workflows and permissions
• All-in-one platform for HR management
• Convenient integrations with third-party tools
• Support for businesses of all sizes

Cons:

• Expensive pricing for smaller companies
• Confusing configuration for automated workflows

#4. Xero Payroll: Best for Employee Experience

Xero may be best known for its accounting software, but it also offers an “add-on” solution for payroll management. Like the accounting software, Xero’s payroll solution is easy to use and convenient. It even offers a self-service payroll app for employees, so workers can access their payslips instantly, rather than waiting for messages from their business leaders.

Employees can also use the toolkit to check their leave balance, see their timesheets, and request leave from any mobile device. As an added bonus, Xero allows business leaders to collaborate on payroll, by assigning permissions to multiple admins. 

Key features:

• Automatic pension enrolment and re-enrolment
• Timesheets with automatic leave tracking
• Convenient employee self-service app
• Automated integration with pension providers
• Full integration with Xero’s accounting suite
• Adding Payroll to your Xero accounting subscription costs £5 per month per employee for the first five team members, with another £1 for every additional employee. Notably, Payroll isn’t available as a standalone service, so you will need a Xero accounting subscription too. 

Pros:

User-friendly interface for beginners

• Convenient app for employees
• Custom permissions for collaborative payroll
• Automation for a range of tasks
• HMRC approved tracking

Cons:

• Additional fees for extra features like expense tracking
• Limited integration with third-party accounting tools

#5. QuickBooks: Best for QuickBooks Users

If, like many UK business leaders, you’re already using QuickBooks Online to manage your accounts, then QuickBooks Payroll could be ideal for you. This simple cloud-based software is easy to use and packed with automation capabilities. 

While the basic plan for QuickBooks Payroll is well-suited to smaller businesses, the more expansive advanced plans come with a variety of additional HR tools. You can access time-tracking tools, payroll reports, pension scheme integrations and more. Plus, the technology integrates seamlessly with QuickBooks Online for accounting.

Key features:

• Weekly and monthly pay schedule options
• Automatic pension assessment and enrolment
• Time-tracking and leave management tools
• Customisable payroll reports
• Payroll deduction management 
• QuickBooks doesn’t provide much information about its Payroll plans on its website. Usually, it’s included as an add-on to QuickBooks Online plans, starting at around £2 per month. 

Pros:

• Instant synchronisation with QuickBooks Online
• Thorough automation options for business leaders
• Free onboarding sessions
• Excellent HR tools on advanced plans
• Simple and user-friendly cloud technology

Cons:

• Confusing pricing structure
• Only suitable for QuickBooks users

#6. MoneySoft: Best for Paying Contractors

While many payroll software options make it easy to manage payroll for traditional employees, not all offer tools for handling freelancers and contractors. Fortunately, Moneysoft offers a solution. This desktop-based software automates and simplifies payroll for companies with a flexible workforce.

This solution comes with access to automatic payroll runs, pension enrolment, and payslip generation. You can even create employee calendars to record absences and holidays. However, there are some limitations too. As a desktop-based software with local storage only, it’s not ideal for companies that need to access payroll technology on the move.

Key features:

• Automatic payroll and payslip generation
• Pension enrollment and integrations
• Employee calendars for sick leave and holidays
• Automatic syncing with Moneysoft Money Manager
• CSV file exports for bookkeeping software
• Moneysoft has three payroll plans, which all feature the same payroll and reporting features. They start at £82 for a one-off download. 

Pros:

• Excellent tools for handling contractors and subcontractors
• Integrations with money management tools
• Useful knowledge base for beginners
• Straightforward reporting capabilities
• HMRC recognised

Cons:

• No cloud-based tech or self-service portals
• Outdated interface in some areas

#7. Brightpay: Best Desktop Software

Another excellent option for business leaders who don’t need the flexibility and agility of the cloud, Brightpay is a versatile desktop-based payroll tool. It supports various pay schedules, from weekly, to monthly and quarterly. It also allows employers to choose to pay employees individually or in groups. 

Brightpay does have an optional cloud add-on for those in need of online features, such as automated cloud backup and client payroll submission. However, it’s limited in its cloud-based functionality. Additionally, cloud access will add an extra fee to your monthly subscription. 

Key features:

• Support for multiple schedules and pay rates
• P60, P11, and P45 generation and printing
• Custom employee calendars
• Automatic pension enrolment
• Per-employee benefits and expense tracking
• BrightPay packages start at £79 per year for up to three employees. The more expensive plans simply add additional employees to your subscription, rather than extra features. 

Pros

• Generous 60-day trial for beginners
• Options for cloud connections (with an extra fee)
• Support for all pay schedules, rates, and dates
• Flat-rate annual plans
• Full HMRC support

Cons:

• No self-service portals for employees
• Additional fees for cloud access

#8. FreeAgent: Best for Micro Businesses

If you’re looking for a simple payroll tool with accounting features, FreeAgent could be an ideal solution. Designed specifically for smaller businesses, FreeAgent is an easy-to-use toolkit, with basic payroll processing, and an array of financial capabilities. It includes support for expense tracking, invoicing, cash flow, and time tracking. 

Unfortunately, FreeAgent does focus more on accounting than payroll, meaning it lacks some of the advanced capabilities of payroll-only services. For instance, you can’t access pay slips through a self-service portal, and there are no automatic pension enrollment solutions. 

Key features:

• Basic payroll processing
• Wide range of accounting tools
• Automatic P60 creation
• Student loan and parental leave pay management
• Automatic general ledger updates
• Companies with a business bank account through providers like NatWest can access FreeAgent for no extra cost. Paid plans start at £19 per month. 

Pros:

• Combined accounting and payroll capabilities
• Specifically designed for small business owners
• Free plan for some customers
• Easy to use backend environment
• Fully HMRC recognised 

Cons:

• Limited scalability for larger companies
• No self-service access for employees

Finding the Ideal Payroll Management Software

Payroll management software isn’t just a “nice to have” in today’s landscape. It’s a crucial resource all UK business leaders need to invest in to ensure they’re complying with the regulations set by the HMRC, and maintaining happy employees. 

With the right payroll management software, you can save time and money, avoid fines, and ensure your business continues to grow.