Best payroll software in New Zealand: Top solutions for employers

Managing payroll is a core function of any business with employees. It can also be one of the most complex and time-consuming administrative tasks. For New Zealand employers, getting it right involves navigating specific tax obligations, employment laws and employee entitlements. 

This is why effective payroll software is so important for businesses of any size. A good system automates complex calculations, ensures you meet your legal obligations and frees up valuable time. This guide explains why investing in the right payroll software matters for your business, as well as the best payroll software available in the New Zealand market. 

Why payroll software matters for New Zealand businesses

Using dedicated payroll software is a fundamental tool for modern business management in New Zealand. Manually calculating wages, PAYE tax, KiwiSaver and leave entitlements is not only inefficient but also full of risk. A single error can create significant problems. Payroll software is designed to manage these complexities and assist with accuracy and consistency.

The primary benefit of software is that it can help you with managing compliance with IRD requirements. Software is often built to handle payday filing, where you must send employment information to the IRD every time you pay your staff. This includes details on earnings, PAYE deductions, KiwiSaver contributions and student loan repayments. The right software automates this filing process, submitting the required data directly to the IRD on time for every pay run. 

Automation is another major advantage. The software handles recurring tasks that would otherwise consume many hours of administrative work. By automating these processes, you reduce the administrative burden on yourself or your team. This allows you to focus on other critical areas of the business like growth, strategy and team development. 

Finally, good payroll software can improve employee satisfaction. Many modern systems also include employee self-service portals. These portals allow team members to view their payslips, check their leave balances and update their personal details online. This transparency and accessibility gives employees more control over their information and reduces the number of payroll-related queries you have to handle. 

What payroll software features are the best for small businesses

When choosing payroll software for a small to medium-sized enterprise (SME), it is important to focus on features that deliver the most value. You need a solution that simplifies administration without adding unnecessary complexity.

Here are the must-have features for small businesses in New Zealand:

• KiwiSaver and superannuation management: The system must accurately calculate and manage employer and employee KiwiSaver contributions. It should also handle opt-ins, opt-outs and contribution holidays correctly.
• Leave tracking and management: A robust leave management function is crucial. The software needs to track and calculate entitlements for annual holidays, sick leave and bereavement leave, according to New Zealand legislation. 
• Employee self-service portals: Giving employees access to their own information is a major time-saver. A self-service portal allows staff to view and download their payslips, check leave balances and submit leave requests online.

These core features form the foundation of an effective payroll system for an SME. They address the most critical aspects of payroll administration, ensuring compliance and efficiency.

Payroll software solutions: Free vs paid options

When you start looking for payroll software, you will find both free and paid options available. The best choice depends on your business size, complexity and future growth plans.

Free payroll solutions can be an attractive starting point for very small businesses or startups with only one or two employees. These tools typically cover the basics, such as calculating PAYE and generating payslips. However, they often come with significant limitations. Support may be limited to online forums, features might be restricted and they may not integrate with other business software like accounting systems. Free options are often designed to handle only the simplest payroll scenarios and may not scale as your business grows.

Paid payroll platforms offer a much more comprehensive and scalable solution, providing a wealth of features designed to grow with your business. These platforms are often updated to reflect changes in tax laws and employment legislation. The ability to manage more complex payroll situations, such as varied employment agreements or detailed reporting, makes paid software a more robust choice for most businesses. 

Payroll software solutions pricing comparison

Understanding the cost of payroll software is key to making an informed decision. In New Zealand, most providers use a subscription-based model but the specifics can vary.

The most common pricing structure is a per-user, per-month fee. This means you pay a set amount for each employee on your payroll each month. For example, a provider might charge a base fee plus $5 to $10 per employee. This model is scalable, as your costs directly align with the size of your team.

Some providers offer bundled packages. These bundles might include payroll along with other services like HR software for a single price. This can be cost-effective if you need the additional services. However, it is important to evaluate the quality of each component to ensure it meets your needs.

When comparing prices, watch out for hidden costs. Some things to look for include:

• Implementation fees: Is there a one-off cost to set up the software?
• Support charges: Is customer support included in the subscription or is it an extra charge?
• Fees for extra features: Are features like project time tracking or advanced reporting included or do they cost more?

Always ask for a detailed breakdown of all potential costs before committing to a platform. This will help you budget accurately and avoid surprises down the line.

ROI of payroll software solutions

Investing in paid payroll software delivers a tangible return on investment (ROI) for your business. The value extends far beyond simply processing pay.

The most immediate return is time saved. Automating calculations, payday filing and leave management frees up hours of administrative work every month. This time can be redirected to revenue-generating activities, strategic planning or improving customer relationships. The efficiency gains alone can quickly justify the subscription cost.

Fewer compliance risks translate into significant cost savings. Payroll errors can lead to IRD penalties and expensive legal disputes with employees. A reliable payroll system reduces the risk of human error by automating complex calculations. This protects your business from financial and reputational damage.

Overall, the cost efficiency of good payroll software is clear. By reducing administrative overhead, minimising compliance risks and providing powerful data, the software becomes a strategic asset. It supports the smooth operation of your business and contributes directly to your bottom line.

Best payroll software options in NZ

If you’re on the hunt for the best payroll software for your SME, we’ve created a list of the top providers in New Zealand to help you out. Of course, we’re at the top, but we had to be honest; we think we’re the best. We hope you find it useful. 

1. Employment Hero

Founded in 2014, Employment Hero is a cloud-based, all-in-one HR and payroll software that services over 300,000 businesses globally. Its Employment Operating System is designed to help businesses effectively navigate the complexities of payroll management, and empowers organisations to focus on what matters most – their people.

Key features

We’re an integrated HR and payroll platform, offering various features aimed at simplifying the payroll process and employee management in New Zealand. Some key features of our payroll include:

Automated payroll software: No need to process payroll manually or manage complex payroll tasks. From automatically creating pay runs and importing timesheets, to managing pay rate changes and tracking bank holidays, our software tackles tedious tasks for you.

IRD payroll reporting: Take the pain out of pay runs with our automated IRD reporting. With every payroll cycle, key information is sent to Inland Revenue so that you can be sure you’re meeting your reporting obligations. 

Automated Kiwisaver deductions and contributions: Our online portal makes it easy for employees to choose their own set Kiwisaver deductions. That information is then automatically shared with our payroll system, so that the correct calculations are made with every pay run. 

Holiday pay calculation: Our payroll software simplifies leave management with instant reports on balances and clear holiday pay calculations. Use standard or custom leave allowance templates, such as the 52-week average report, for streamlined adjustments for all your employees.

Time and attendance: Access comprehensive attendance reports to resolve any uncertainties about shifts worked – benefit from real-time employee location tracking and alerts for missed shifts. Our employee self-service portal submits timesheets when employees clock out, simplifying the review process for managers.

Rota and shift management: Allocate shifts based on skills, encourage staff shift swapping, and automate timesheets with logged work times. Use data-driven insights to schedule the right number of staff during busy periods and easily create schedules with ready-made templates.

Custom pay conditions: Automate pay calculations, bulk pay rate increases, and date-triggered wage adjustments to streamline the payroll process, eliminate errors, and save time.

Best for

We’re an all-in-one online payroll solution that helps SMEs streamline payroll processes with automated calculation and pay employees easily. You can enjoy the flexibility of running payroll from anywhere using our digital system and we’ll help you submit all required information to IRD in good time. 
With automated cloud backups, you can rest easy knowing your data is safe. We also have numerous accounting, payroll and payment integrations, so we’ll fit into your existing tech stack with ease; and you can reap the benefits of our recruitment and HR software all in the same place.

2. Xero

Xero Payroll is an integrated payroll solution offered by Xero, a popular accounting software provider. 

Key features

Some key features of Xero Payroll include:

Automated pay runs: Easily create and automate pay runs, including options for weekly, bi-weekly or monthly pay schedules.

Self-service employee portal: Employees can access their payslips, update personal details and apply for leave through the employee portal, reducing administrative tasks for HR.

Tax and statutory compliance: Xero Payroll helps in automating tax calculations and deductions, ensuring compliance with IRD regulations. It keeps track of PAYE (Pay As You Earn) and Kiwisaver contributions.

Reporting: Access various reports related to payroll, including PAYE summaries, employee earnings, tax and more.

Integration with Xero Accounting: Seamlessly integrate payroll data with Xero’s accounting software for a complete financial picture of the business.

Mobile access: The platform is accessible via mobile devices, allowing for on-the-go management and approvals.

Security and compliance: Xero maintains high-security standards for payroll data, ensuring encryption and compliance with data protection regulations.

Best for

Xero Payroll is suited to small and medium-sized businesses (SMEs), offering user-friendly online payroll management tailored to their needs. Its strength lies in simplicity and accessibility, making it ideal for SMEs with straightforward payroll requirements. 

Xero Payroll’s intuitive interface, automated processes and integration with Xero Accounting suit smaller enterprises seeking an efficient cloud-based payroll solution. While capable of handling larger businesses, its focus on streamlined functionalities makes it particularly beneficial for smaller entities aiming for straightforward and manageable payroll processes without extensive complexities.

3. PaySauce

PaySauce is a payroll and employee management software that offers automated payroll processing, compliance management, and integrated features to streamline HR operations. It caters to small and medium-sized enterprises (SMEs) in New Zealand.

Key features

Payroll processing: Automate payroll calculations including wages, taxes, and deductions.

Employee management: Manage employee details, working hours, leave balances, and personal information.

Leave management: Organise employee leave entitlements, requests, and approvals.

Integration: Integrates with accounting software to streamline financial processes.

Compliance and reporting: Ensure compliance with New Zealand payroll regulations and generate reports for tax filings.

Timesheets: Employees can submit timesheets electronically for accurate record-keeping.

Employee self-service: Provides a portal for employees to access pay stubs, update personal information, and submit leave requests.

Best for

SMEs benefit from PaySauce’s ability to automate payroll calculations, manage employee details, handle leave requests, and generate reports for tax filings.

Moreover, PaySauce offers a scalable payroll solution that can adapt to business growth. It offers integrations with accounting software, allowing companies to tailor the platform to meet their specific needs while ensuring accuracy, compliance, and efficiency in managing payroll.

4. ADP

ADP (Automatic Data Processing) is a global provider of human resources management software and services, specialising in payroll processing for businesses of various sizes. It offers cloud-based platforms and tools to manage payroll, employee benefits, time tracking, and HR tasks efficiently.

Key features

Payroll processing: Automate payroll calculations, tax deductions, and direct deposits.

HR management: Track employee information, benefits administration, and performance management.

Time and attendance: Manage employee work hours, attendance tracking, and scheduling.

Benefits administration: Handle employee benefits enrollment, management, and compliance.

Talent management: The platform supports recruitment, onboarding, and training processes.

Compliance assistance: Ensure compliance with local tax regulations and employment laws.

Reporting and analytics: ADP generates reports and insights for payroll, HR, and workforce analytics.

Employee self-service: Employees can access pay stubs, update information, and manage benefits.

Best for

ADP Workforce Now is particularly beneficial for medium to large enterprises requiring comprehensive HR and payroll management tools. 

However, SMEs can benefit from ADP’s adaptable platforms that offer flexible options for payroll, employee management, and compliance, allowing them to manage their HR tasks efficiently as they expand and evolve.

5. iPayroll

iPayroll is a cloud-based payroll software service used in New Zealand, offering streamlined payroll processing, employee management, and compliance functionalities. 

Key features

Payroll processing: Automate calculations for wages, taxes, and deductions.

Employee management: Track employee details, working hours, leave balances, and personal information.

Leave management: Handle employee leave entitlements, requests, and approvals.

Compliance and reporting: Ensure compliance with New Zealand’s payroll regulations.

Employee self-service: iPayroll provides a portal for employees to access payslips, update personal information, and submit leave requests.

Timesheets: Timesheets can be submitted electronically for accurate record-keeping.

Customisation: iPayroll has customisable settings to align with specific business needs and policies.

Best for

iPayroll caters primarily to small and medium-sized businesses (SMEs) operating in New Zealand, offering a user-friendly and comprehensive payroll service. 

Its features are well-suited for businesses seeking an efficient, automated payroll system combined with compliance management and employee self-service functionalities.

6. FlexiTime

FlexiTime is an online payroll and time management software, providing features such as automated payroll processing, time tracking, leave management, and compliance assistance. 

Key features

Payroll processing: Automate payroll calculations, tax deductions, and pay runs.

Time tracking: Manage employee work hours, including clock-ins, breaks, and overtime.

Compliance assistance: Ensure adherence to New Zealand’s payroll regulations.

Employee self-service: FlexiTime has a portal for employees to access pay information, submit timesheets, and manage personal details.

Reporting and analytics: Generate reports on payroll, timesheets, and leave data for analysis and decision-making.

Mobile access: The platform is accessible via mobile devices, allowing for on-the-go management and approvals.

Integration capabilities: Integrate FlexiTime with accounting software and other systems for seamless data exchange.

Best for

FlexiTime is best suited for businesses with a mobile or remote workforce. Its mobile accessibility and employee self-service features empower staff to manage their time, submit timesheets, and access payroll information conveniently from various devices. 

This makes FlexiTime a good choice for SMEs aiming to efficiently manage payroll and time-related tasks, while accommodating the modern workforce’s flexibility and mobility requirements.

Integrating payroll software with HR and rostering systems

Selecting an online payroll solution that seamlessly integrates with HR software can significantly enhance efficiency. Look for systems that offer a cohesive platform, integrating payroll and HR software functionalities. Streamlining data across both areas eliminates redundancies, simplifies processes and provides a comprehensive view of employee information. This integration ensures consistency and accuracy in managing payroll and HR tasks.

How to choose the right payroll software for your business

There are a few important considerations when it comes to choosing payroll software. 

Pricing and cost

Understanding the pricing structure of payroll software is crucial. Don’t just go with a favourite first – assess other payroll software solutions to check whether the pricing aligns with your business needs and budget. Some systems may charge based on the number of employees, while others might offer tiered pricing based on features. Consider hidden costs, such as fees for additional services or support. Ensure the chosen solution not only fits your current financial capabilities but also remains scalable as your business grows.

Ease of implementation

Ease of implementation plays a pivotal role in transitioning to a new payroll system. Opt for payroll providers that offer a smooth onboarding process, providing adequate training and support. Look for user-friendly interfaces and straightforward setup procedures. Assess the vendor’s support resources, including documentation, tutorials and customer service, to facilitate a hassle-free transition for your team.

Automatic tax filing

Efficient payroll software should automate payroll tax filing processes. Look for systems that handle tax calculations and deductions accurately, ensuring compliance with local tax regulations. Ensure the software facilitates direct submission of tax reports and payments to relevant authorities, simplifying the often complex and time-sensitive tax filing procedures.

Global online payroll management

For businesses with an international presence or remote employees, selecting payroll software that supports global payroll management is crucial, like Employment Hero’s Global Teams Employer of Record (EOR) service. Consider systems that accommodate multi-currency payments, comply with diverse tax laws across regions, and offer localisation features. An ideal solution should provide centralised control while adapting to various regulatory requirements and currencies, ensuring smooth payroll operations worldwide.

Automate payroll processes with Employment Hero

Automate as much of your payroll processes as you like by harnessing the power of a fully integrated online payroll software and HR platform. Run payroll reports in a few clicks, and never lose a timesheet or leave request again. 

Our award-winning payroll management software is recognised globally for providing outstanding product and customer experience. So why not join the league of successful businesses who’ve transformed their payroll operations with the best payroll software?