Official prices checked October 28, 2026 · USD

How much does payroll cost?

For five billable people, Square's published full-service rate produces a $65 monthly subscription and a $780 annual subscription subtotal: ($35 + $6 × 5) × 12 = $780. This answers how much a payroll service can cost in this example. It excludes employee wages, employer taxes, benefits funding and unconfirmed extras. Your actual bill depends on the package, people billed each month and written terms.

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Choose which bill you mean before comparing a number

A software quote and an employment budget answer different questions. Write the scope beside every total, then match people and periods.

If tax filing is included, that describes the filing service. It does not mean the employer's tax liability is funded by the subscription. Retain the separate employer payroll-tax worksheet; this page does not supply a state-blind tax estimate.

Dated five-person examples, not a market average

These public entry-plan calculations use prices checked October 28, 2026. They are package subtotals, not rankings or a claim that the plans cover the same work.

Square's official payroll product and rates · checked October 28, 2026 supply the $35 base and $6 person charge. Its official payroll pricing and inclusion table · checked October 28, 2026 separates full-service from contractor-only pricing. The annual multiplication is our arithmetic.

The Gusto official plan pricing · checked October 28, 2026 supplies Simple's $49 and $6 rates and one-state scope. Bundles that include accounting need a separately matched scope. Unknown setup and selected extras remain outside these subtotals.

Use the annual payroll cost calculator for your own written quote. For differences in benefits or accounting scope, use the Gusto–QuickBooks cost-component comparison rather than assuming the smallest packages cover identical work.

Payroll cost per employee: use the right denominator

At constant headcount, effective monthly service cost per person = base ÷ billable people + person rate. The base is shared, not multiplied by each employee.

For an illustrative schedule with five people billed for six months and ten for six months, add the actual periods: ($35 + $6 × 5) × 6 + ($35 + $6 × 10) × 6 = $390 + $570 = $960. Multiplying only the final $95 month by twelve gives $1,140, overstating this schedule by $1,140 − $960 = $180.

The denominator is 5 × 6 + 10 × 6 = 90 billed person-months. $960 ÷ 90 = $10.67 per billed person-month, rounded to cents. Dividing by the final ten people does not describe each person's full-year cost. This synthetic sensitivity example is not a claim about inactive-staff billing: confirm who counts on your contract.

Employer payroll cost: why $780 is not the whole budget

Assume, for illustration only, five employees each earn $30,000 gross annually. Those synthetic wage inputs give 5 × $30,000 = $150,000. Adding the service subscription gives a $150,780 known-components subtotal: $150,000 + $780. Employer taxes, benefits, insurance and other selected charges remain unconfirmed. There is no complete employer total yet.

A bank withdrawal can combine a service fee with money passed onward for wages and taxes. Categorize its lines before calling the entire withdrawal a software expense. Start from gross wages; do not also add employee withholding already contained in them. Record employer-funded contributions separately.

Take a fillable scope ledger back to the provider

The CSV contains dated worked examples and a blank reconciliation section. Fill the annual amount, inclusion status, evidence and responsible person for every cost line. Blank means pending confirmation, not zero. Write Included for a service already paid for in the subscription.

Download the payroll cost scope ledger (CSV)

1. Confirm package identity and who counts as billable.
2. Record each period's headcount, rate and promotion end date.
3. Request setup, forms, modules and renewal charges separately; avoid double-counting included services.
4. Separate gross wages, employer tax liabilities and benefit funding from provider fees.
5. Keep your documented work hours and hourly cost outside the supplier invoice.

The Square annual-cost breakdown traces a public rate card. The Paychex written-quote checklist handles unpublished rates: unknown amounts remain unknown until supplied in writing.