How much does payroll software cost in the UK? (2026/27 guide)

The price for payroll software you see on a website is often only the starting point. The true cost depends on factors such as how many employees you pay, how often you pay them and what sits outside your regular subscription. Miss one of these elements and your budget can be out by hundreds, if not thousands, of pounds a year.

In today’s economy, with inflation rising to its highest rate in almost a year, it’s important that your payroll software cost fits your budget.

The focus on cost comes as no surprise, as many UK businesses are still feeling the shock of the rise in employer National Insurance contributions that took effect in April 2025, with many stating ‘the impact is still being felt’.

To help you make an informed choice, this guide explains how UK payroll software is priced in 2026/27, shows what it costs at different payroll sizes and highlights the extra costs you need to check before you sign.

Throughout this guide, we use Staffology Payroll, our cloud payroll software, as the real-world example to help illustrate what the cost may look like for your business.

Key takeaways

• UK payroll software is usually priced per employee per month, per payslip, as a base fee plus a per-employee charge, or as a tiered subscription.
• Pay frequency can change the cost of your payroll software; weekly pay produces 52 payslips per employee each year (53 in some tax years), while monthly pay produces 12.
• Budget for costs outside the monthly fee, such as implementation, data migration, parallel runs, training and VAT.
• Staffology Payroll starts at £43 a month for up to 20 payslips, then costs £2.15 per payslip up to 50 payslips a month. Payrolls of 51 or more payslips a month get a bespoke quote. All prices exclude VAT.

How much does payroll software cost in the UK?

There’s no single price for payroll software in the UK. The cost of payroll software largely depends on the vendor’s pricing model, your number of employees, the number of payslips you process, how often you pay employees and the additional features and support you need.

As an example, Staffology Payroll starts at £43 a month plus VAT, which covers up to 20 payslips.

HMRC also lists free recognised payroll software, but it’s only for employers with fewer than 10 employees.

You can check both free and paid payroll software options on GOV.UK’s list of HMRC-recognised payroll software.

How is payroll software priced?

UK payroll software providers typically use one of six pricing models, and then there’s also managed payroll to consider.

Pricing model matters as much as the headline price; each model responds differently when you hire, change pay frequency or add features.

Use the table to see how each pricing model works and what to check before you commit.

For those weighing up payroll software against payroll outsourcing, our guide to in-house vs outsourced payroll compares the two.

How does per-payslip pricing work?

Payroll software with per-payslip pricing charges for each payslip you produce, not each person you employ.

As a result, pay frequency is a major cost driver.

For example: 20 employees paid monthly produce 240 payslips a year, whereas the same 20 employees paid weekly produce 1,040.

Businesses where headcount changes throughout the year, such as seasonal employers, can benefit from per-payslip pricing because they pay for what they process.

Per-employee pricing, on the other hand, can be easier to forecast when headcount is stable, as the cost doesn’t change with pay frequency.

What does payroll software cost for different payroll sizes?

Using Staffology Payroll’s pricing as the frame of reference, a business paying 12 people monthly pays £43 a month before VAT, and a business paying 50 people monthly pays £107.50.

From 51 payslips a month, Staffology Payroll pricing is by bespoke quote.

For larger payrolls, your Staffology Payroll quote reflects your monthly payslip volume, your pay frequencies and the implementation and support you choose.

Get a quote for your payroll.

What costs sit outside the monthly fee?

When it comes to payroll software, the subscription is rarely the full cost.

Many of the costs below may or may not be included in your subscription, so they’re worth clarifying before you sign on the dotted line.

• Implementation: self-setup is often free, while a guided implementation is usually sold as a package.
• Data migration: moving employee records across to a new system, and a mid-year switch means bringing across year-to-date figures too.
• Parallel runs: running your old and new systems side by side for one or more pay periods to confirm results match before you go live.
• Training: guides and webinars are often free, but one-to-one sessions typically cost extra.
• Support levels: check which support channels and hours your plan includes, and whether faster support costs more.
• Add-on modules: HR, employee self-service, extra reporting and P11D processing may be priced separately.
• Integrations and API access: connections to accounting, HR, time & attendance or payment systems may carry set-up or ongoing fees.
• Pension provider connections: double-check whether direct connections or contribution files are included.
• Minimum fees and contract length: a minimum monthly fee or a 12-month term impacts your total cost, even if headcount drops.
• VAT: most UK software vendor prices exclude VAT, which is charged at the standard rate of 20%.

Note: Employer National Insurance, pension contributions and statutory payments are all employment costs, not software costs. While your software calculates them, you have to pay them regardless of which system you use. GOV.UK explains these obligations in its guides to PAYE for employers and workplace pensions for employers.

What does it cost to switch payroll software?

Often, the biggest cost when switching payroll software is time and attention, not large fees.

It’s a price worth paying if your current system isn’t up to the job.

The one-off cost of moving is often smaller than the ongoing cost of staying.

Errors every pay run, hours of admin and uncertainty about compliance are all valid reasons to make a move.

When you switch, budget for the following:

• Notice periods and overlap: you may need to pay for both systems while you serve notice and run parallel payrolls.
• Data export: check which formats your current system exports, and whether you can still access historic payslips and reports after you leave.
• Year-to-date figures: a mid-year switch needs each employee’s cumulative pay, tax and National Insurance moved across accurately.
• Parallel runs: each parallel pay period takes time to process and reconcile.
• Staff time and training: your team needs time to learn the new system, often during normal pay cycles.

Our payroll software switching guide walks through implementation, data migration, parallel runs and support step by step.

How much does combined HR and payroll software cost per employee per month?

The total cost of combined HR and payroll depends on how each offering is priced.

HR software is often priced per employee per month, while payroll may be priced per payslip.

To determine the total cost, add the two monthly costs together for your headcount and pay frequencies, then divide by your number of employees.

It’s worth noting that combined HR and payroll comes in two forms, which will also impact the cost.

Built-in payroll is a module inside the HR platform, while integrated payroll connects two separate systems, so check how each part is charged.

Our guide to HR software with built-in payroll vs integrated explains which option best suits which business.

At IRIS, Staffology HR with Staffology Payroll is our integrated option.

Staffology HR is priced per user per month, with a minimum of 10 users, and prices are subject to VAT:

• £0.76 on Foundation
• From £2.15 on Essential
• From £4.20 on Professional
• Ultimate priced on request

How do you compare payroll software quotes?

When comparing payroll software quotes, look at the total annual cost, including any add-ons, not just the monthly headline prices.

It’s worth creating a dedicated checklist you take to each vendor to ensure every quote covers the same requirements.

Use this checklist as an example:

1. Confirm the total annual cost at your current headcount and at your expected headcount in two years.
2. List your pay frequencies, including any weekly or fortnightly payrolls.
3. Determine what’s included and what costs extra.
4. Clarify set-up, implementation and data migration fees.
5. Check the contract length and notice period.
6. Ask which support channels and hours are included.
7. Confirm the software appears on GOV.UK’s list of HMRC-recognised payroll software.

What do you get with Staffology Payroll?

Staffology Payroll is HMRC-recognised cloud payroll software built for payrolls of all sizes.

The system is particularly strong for UK businesses with 50 to 1,000 employees that have outgrown basic payroll software.

With Staffology Payroll, you pay £2.15 per payslip for up to 50 payslips a month, with a £43 monthly minimum (plus VAT). You can also start with a free trial.

Staffology Payroll features include:

• Automatic Full Payment Submissions (FPS) to HMRC after each pay run
• HMRC tax code notices retrieved and applied automatically
• Real-time pay calculations
• Compliance checks before you submit flag issues such as missing bank details or pay below the National Minimum Wage (NMW)
• More than 40 off-the-shelf reports
• An online payslip portal (IRIS My ePay Window)
• Single sign-on (SSO), multi-factor authentication (MFA), role-based access and audit trails

Getting started: if you have fewer than 50 employees, you can set up Staffology Payroll yourself and start processing payroll within minutes, using our training videos and knowledge base. For larger payrolls, we recommend a guided implementation where we’ll agree a timeline with you, set up Staffology Payroll, move your data across and train your team.

Support: you can reach our specialist team by phone, live chat or support ticket, and our knowledge base is available 24/7.

Integrations: pre-built connectors link Staffology Payroll to popular accounting, HR, time & attendance, pension and payment platforms. Our open API also supports custom integrations.

Try Staffology Payroll free

If you’re an accountancy firm or payroll bureau running payroll for clients, take a look at Staffology Bureau.

UK payroll software cost

Frequently asked questions (FAQs)

How much does payroll software cost per employee per month in the UK?

The cost of payroll software depends on the pricing model. Some UK payroll software is priced per payslip rather than per employee. If you pay everyone monthly, each person gets one payslip a month, so the price of a payslip is also your price per employee. If you pay people weekly, the same person gets four or five payslips a month, so your cost per employee is four or five times higher. Staffology Payroll charges £2.15 per payslip with a minimum charge of £43 a month. A 30-person monthly payroll comes to £64.50 a month plus VAT, which is £2.15 per employee.

Is payroll software priced per employee or per payslip?

Per-employee and per-payslip pricing are both common cost models for payroll software. Per-employee pricing charges a fixed amount for each person on the payroll each month, regardless of their pay frequency. Per-payslip pricing charges for each payslip produced, so weekly-paid staff cost more than monthly-paid staff. Staffology Payroll uses per-payslip pricing.

Does weekly payroll cost more than monthly payroll?

Under per-payslip pricing, weekly payroll can cost more. A weekly-paid employee produces 52 payslips a year, compared with 12 for a monthly-paid employee. However, the overall cost will largely depend on what a vendor is charging per employee and per payslip.

Do payroll software providers charge set-up fees?

Some payroll software providers do charge a set-up fee. Smaller businesses can often set themselves up at no extra cost. However, guided implementation, data migration and parallel runs are commonly sold as a package. Businesses with fewer than 50 employees can set up Staffology Payroll themselves and start processing payroll within minutes. For larger payrolls, Staffology Payroll offers guided implementation, with a timeline agreed with you.

Is VAT included in payroll software prices?

VAT is typically not included in the payroll software price. Most UK business software prices are quoted before VAT, which is charged at the standard rate of 20%. Staffology Payroll’s prices are subject to VAT, so the £43 minimum monthly fee is £51.60 including VAT. If your business is VAT-registered, you may be able to reclaim it.

Can I switch payroll software partway through a contract or tax year?

Yes, you can switch payroll software mid-year, but you need to plan for it. A mid-year switch means moving year-to-date figures so tax and National Insurance stay correct. Switching on 6 April avoids that step. If you’re changing partway through a contract, check your notice period and any exit fees. Our switching guide covers the process.

Is free payroll software suitable for a growing business?

HMRC’s free recognised payroll software is for businesses with fewer than 10 employees. It covers core PAYE reporting, but may not include features such as pension integrations, employee payslip portals or detailed reporting. Once you reach 10 employees, or your payroll becomes more complex, you’ll usually need paid software.