Square has been a leader in digital payment services for years, helping online and brick-and-mortar businesses collect payments, access funds, and create rewarding loyalty programs. 

Square Payroll provides convenient payroll and tax services, adding to Square’s all-in-one merchant-focused solution. Small businesses, especially, can benefit from using a payroll service like Square Payroll to pay their teams, deduct taxes, review sales, and more. 

Learn how Square Payroll can ease payroll management for your team.

Square Payroll Compared

Square Payroll did not make our top list of online payroll services. Our top pick, Gusto, is an excellent alternative to Square Payroll for most businesses, including new companies without a dedicated payroll team. Try Gusto free for 30 days.

• Gusto — Best for dispersed workforces
• Paychex — Best for experienced payroll teams
• OnPay — Best for simplifying all things payroll
• QuickBooks Payroll — Best for solopreneurs and small teams
• ADP — Best for never outgrowing your payroll provider

Read more about the best online payroll services.

About Square Payroll

Although Square Payroll didn’t make our top list for online payroll services, it still offers plenty for small businesses. The company helps small business owners without payroll experience pay employees and contractors, track paid time off, and withhold multistate taxes.

• Square Payroll Online Payroll Services Review

Square Payroll also combines other key employee management services, like time tracking, invoicing, workers’ compensation, and benefits package management. Business owners can choose between contractor-only plans or plans covering payments for contractors and employees.

Square Payroll Health and Stability

Although Square was founded back in 2009, Square Payroll is a more recent offering from the digital commerce company, introduced in 2015. Square Payroll operates in all 50 of the United States and the District of Columbia.

Square has exhibited a promising amount of growth over its lifetime. Its parent company, Block, Inc., saw a 101.5% increase and an 85.95% increase in revenue from 2019-2020 and 2020-2021, respectively. 

Although 2022 growth hasn’t been as drastic, Square’s movement into other financial and commerce services gives it plenty of room for successful expansion. For instance, the company owns Cash App and Weebly, two powerhouse services in their industries. 

As a result, we only expect Square and Square Payroll to continue moving up the ranks as a commerce services provider. With Square Payroll seamlessly connecting to other Square services, users can expect it to remain as strong and reliable as its parent company.

Square Payroll Pricing

Square Payroll keeps its pricing transparent by showcasing its pricing structure on its website. With just two plans available, Square Payroll offers an uncomplicated process for choosing a plan based on whether you use contractors or employees.

Square Payroll Pricing Structure

Square Payroll gives businesses a choice between two plans: Contractor Only and Employees and Contractors. 

Both plans include the same features, such as contract-free subscriptions, mailed forms, and seasonal inactivity management. The primary difference is that the Employees and Contractors plan comes with must-have features for employee payroll, like multistate payroll and tax filings and payments.

Billing cycles are monthly. Contractor Only plans are charged per contractor, while an Employees and Contractors plan costs a monthly subscription fee plus a smaller fee for each contractor or employee. 

Square Payroll Pricing Comparison

Designed to meet the needs of small businesses, Square Payroll is a highly affordable payroll service. Its stripped-down nature makes payroll simple to manage and budget-friendly without lacking features.

A Contractor Only plan is $5 per contractor, and an Employees and Contractors plan costs $35 per month plus $5 monthly per employee or contractor. This is lower pricing than the top competitor, Gusto, which starts at $40 per month plus $6 per month for each paid worker. 

Like many other Square Payroll competitors, Gusto does not offer a contractor-only plan. However, Gusto’s more robust employee benefits packages may be worth the extra cost for medium to larger businesses.

Paychex is one of the most comparable payroll services to Square Payroll in terms of pricing and features, with its lowest-tier package costing $39 per month plus $5 per employee per month. Still, this is a few dollars more than Square Payroll and lacks a contractor-only option.

Square Payroll Trials and Guarantees

Square Payroll does not currently offer any free trials, demos, or guarantees. However, the company doesn’t require business owners to sign a contract. This benefit, combined with monthly billing, allows you to cancel your subscription anytime without a significant financial commitment or early termination penalty.

Additionally, Square Payroll is an IRS-certified reporting agent that uses the most up-to-date data and practices to file and manage your business’s payroll taxes accurately. Therefore, the company can assist your business in the event of an audit.

Square Payroll Online Payroll Services Review

Square Payroll targets small businesses needing a simplified online payroll service that manages payments for employees and contractors. Taking advantage of Square’s infrastructure of digital commerce tools, Square Payroll is ideal for businesses already using other Square products, like point-of-sale equipment and team management tools.

Continue reading this review to discover why Square Payroll might be one of the best online payroll solutions for your business.

What Makes Square Payroll Online Payroll Services Great

• Ease of use: Managing payroll shouldn’t be confusing, especially for a small business handling it without a dedicated payroll department. Square Payroll is incredibly simple every step of the way, including its setup. The software asks critical questions to prepare your account and add employee information to the database to start paying them and managing their benefits immediately. A streamlined interface makes it easy to navigate Square Payroll’s features, change information, get reports, and more.
• Team management: Square Payroll goes beyond payment management to also help teams stay organized. Your team can clock in and out with a mobile app while keeping track of their own hours and payments, and you can view the same necessary information on your end. Or, connect your Square Payroll system with Cash App to offer more flexible payment options, like direct deposit and on-demand payments of up to $200 per pay period.
• Multistate payroll: With a boom in independent contracting and remote work, it’s become more common for companies to need to pay employees in multiple jurisdictions. Square Payroll offers multistate payroll management with automatic tax calculations to ensure that you’re withholding the right amount of taxes from each employee, regardless of where they live. Square Payroll automatically remits your tax payments to each jurisdiction’s agency for simplified quarterly or annual filing. It also handles local and federal taxes for your business.
• Affordability: Square Payroll targets small businesses and, therefore, creates a pricing structure that fits small businesses well. This online payroll service is among the most affordable of its kind, with a plan as low as $5 per month per paid user. Even its monthly subscription plan for employees and contractors is priced lower than many competitors with similar features.  
• Contractors-only plan: Square Payroll offers a unique contractors-only plan for businesses that may already have a payroll service for their employees or for those using only independent contractors. This plan allows companies to save money on their payroll costs with no monthly subscription fees and a charge of $5 per contractor per month. The affordable plan still includes must-have benefits to companies paying employees and contractors, like unlimited pay runs and multiple payment options for contractors.
• Seamless Square integration: Businesses already using Square tools and equipment will probably find that Square Payroll fits right into their payment infrastructure without a hitch. Square’s payroll software is designed to work with other Square tools, like its shift scheduling software, time tracking, and reporting. You can even connect your workers’ compensation insurance to your Square Payroll account for easy management of all employee benefits. 
• Mobile app management: Employees, contractors, and employers can use the Square Payroll mobile app to manage their payments and information. For employees and contractors, the app offers payment options, time tracking, scheduling tools, and the ability to clock in and out. Employers can use the app to view and print reports, change schedules, manage their accounts, and run payroll. Basically, anything you can do from the Square Payroll website, you can also do from the mobile app. 
• Flexible usage: Square Payroll includes a few options for out-of-the-box business needs to make your account more flexible. For example, if your business operates seasonally or you have seasonal employees, you can pause your account’s billing to resume when you need the service once again. You can also add and remove workers as needed and begin paying new employees or contractors right away. Additionally, with no contracts needed to sign up for Square Payroll, businesses can cancel their accounts at any time.
• Automatic POS imports: If you use Square POS to handle customer or client payments, the money you make using the system can import directly into your Square Payroll account, too. This can make it easier to manage tips, bonuses, and commissions your team members earn during their shifts. Set up your Square Payroll account to pool tips to split between all employees on that shift or send tips meant for a specific employee to them via your account.
• 401(k) benefits: You can give employees the option of signing up for 401(k) benefits through Square Payroll. The company partners with Guideline to offer this option, allowing you to manage your team’s retirement benefits from the Square Payroll dashboard. Employees can also track and manage their benefits using the app. 

Where Square Payroll Online Payroll Services Fall Short

• Limited scalability: Square Payroll is specifically designed to help small businesses manage their payroll easily. That’s not necessarily a negative point. However, we believe it’s essential to note the company’s target audience, as medium to large businesses may find that it lacks the features they need to handle payroll for a large, diverse team.
• Basic reporting: Square Payroll isn’t as equipped with advanced reporting tools as some of its competitors, like Gusto. Unlike other payroll services that include various customization modes to get tailored reports with just the data you need, Square Payroll only allows you to filter by a few report types, employees, or date ranges. Plus, it’s not currently possible to display these reports on the website or app. Instead, you’ll need to download them.
• Lack of integrations: If your business uses Square already, you won’t need to do much to get Square Payroll to fit right in. However, this service doesn’t have many integrations outside of the Square atmosphere, so you might find it limited if you want a fully connected system of tools.
• Limited customer support: Reliable payroll is a necessity for any business, and being able to contact your payroll provider when you need assistance is priceless. Square Payroll’s customer service is only available by phone or live chat Monday to Friday, 6 am to 6 pm PST, which could feel restrictive for business owners. 
• Narrow benefit options: Square Payroll allows business owners to set up retirement plans, health insurance plans, and other benefits for employees. However, as a payroll provider for small businesses, its benefits aren’t as robust as those from other services, like ADP and Gusto. For instance, you won’t be able to offer an HSA, college savings plan, or life insurance through Square Payroll.

Square Payroll Online Payroll Services Compared

Our top pick for online payroll providers is Gusto, which offers an excellent mix of features and benefits for many types of teams.

• Gusto — Best for dispersed workforces
• Paychex — Best for experienced payroll teams
• OnPay — Best for simplifying all things payroll
• QuickBooks Payroll — Best for solopreneurs and small teams
• ADP — Best for never outgrowing your payroll provider

Final Verdict

Square Payroll is an all-in-one solution for small businesses paying contractors and employees. With a $5 contractor-only plan, it’s also a cost-effective solution for solopreneurs and micro businesses with only a handful of partnered contractors.

Square Payroll’s easy-to-use interface and convenient mobile app make payroll management a breeze for small business owners. However, medium and large businesses will probably want to consider a more comprehensive option, like Gusto or Paychex.

Source: quicksprout

Square Payroll Review