How much does outsourced payroll cost in the UK?

How should you read our employer price bands?

Start with employee numbers and the normal pay schedule. The employer table above gives our published rates; the smallest band has a minimum charge per run, not a £25 charge for each employee. For larger bands, the price is stated per payslip. Make sure a comparison uses the same number of payslips and the same frequency.

Standard payroll processing, secure portal access and statutory workplace pension submissions are included. Compare that scope with each alternative quote before deciding which arrangement fits. A lower headline rate does not tell you whether you are buying calculations alone or a wider managed service.

What do the monthly examples mean?

Twenty employees receiving one payslip each in a monthly run cost 20 × £3.50 = £70.00 for that monthly processing. With 150 employees receiving one payslip each monthly, the example is 150 × £3.00 = £450.00. These examples use only our published employer bands.

Neither example is the total cost of employing the workforce. Gross wages, employer National Insurance and employer pension contributions are separate employment costs. Payroll reports identify those liabilities, but the processing charge must not be confused with money owed to employees, HMRC or a pension scheme.

For a small payroll of five employees, the published minimum is £25.00 per payroll run. Do not multiply that minimum by five, or describe it as a universal monthly subscription. State the actual run schedule when requesting the final written price.

How does pay frequency affect your quote?

Weekly, fortnightly and four-weekly runs are adjusted proportionally. A monthly illustration should not be presented as the price of a weekly service. More frequent processing involves more input deadlines, approvals, payslips and reporting activity across the year.

Give prospective providers the actual pay calendar, including separate weekly and monthly groups. Ask for a calculation using that schedule rather than an assumed conversion. Explain seasonal headcount, extra runs and periods without staff payments. We confirm the final calculation in the quote rather than publish an unverified frequency multiplier.

What does external market research tell you?

A 2026 ExpertSure comparison puts typical managed payroll bureau quotes at about £4 to £12 per employee per month. That is the source's broad market context, not a quote from Streamlining Payroll, a guaranteed market average or a like-for-like benchmark for every service. Its comparison spans different service models.

Figures vary between sources and depend on headcount, frequency and what the provider includes. Use research to form questions, then obtain current written quotations. Do not compare a software subscription, a bureau service and an employment arrangement as if all cover identical work. The ExpertSure source is linked below so you can examine its scope.

What can change the work and final price?

CIS administration, unusual pay structures, payroll frequency, historical corrections and migration can change the required work. An employer with stable salaries and clean records presents a different brief from one with frequent changes, mixed worker arrangements and unresolved balances. Describe those requirements before accepting a price.

Ask for written confirmation of any task outside standard processing, portal access and statutory pension submissions. We do not publish invented additional-work tariffs or assume a VAT treatment here. Your quote should confirm the agreed scope, VAT position and any separately priced work before processing begins.

A typical SME switch takes two to four weeks. Allow time for discovery, HMRC authorisation through Form 64-8, year-to-date reconciliation, a parallel run and employee logins. Migration is a control process, not simply uploading a list of current employees.

What should you compare when asking for quotes?

Prepare one short specification and send the same headcount, pay frequencies and pension details to every provider. Explain how approved hours, overtime, absences and changes reach payroll. Identify who reviews drafts, who approves the final run and what reports your finance team needs.

Compare the complete commitment rather than a headline number. Confirm setup fees, minimums, pension work, CIS, year-end, corrections, notice and named support. Do not assume terms published for a different audience or service apply to your employer quote. Keep the written answers beside the proposal.

• Is VAT included, excluded or not applicable?
• What setup fees, minimum charges and contract notice apply?
• Are pension submissions, CIS and year-end covered or separately scoped?
• How are extra runs, late changes and historical corrections handled?
• Who is your named specialist and who covers absence?
• Who approves payroll, supplies payment files and checks submissions?

Who remains responsible after outsourcing?

The employer remains legally responsible for PAYE. You supply accurate records, approve payroll and pay employees using the payment file we supply. HMRC and pension settlement also require assigned ownership; a completed payroll report does not release funds automatically.

Compare the quote against the internal work left with you. A clear review timetable and a named contact can matter more than a small price difference. For staffing budgets use our calculator, but remember that its employment-cost illustration excludes the bureau fee. See the related pricing page for published inclusions and a written quote for your actual requirements.