Cheapest Square Payroll plan in 2026
Square Payroll has one plan. $35 base, $6 per employee, time tracking included via Square Team, tip handling baked in, same-day direct deposit included. For hourly workforces this is the cheapest legitimate payroll plan on the market once you account for the time-tracking add-on cost every other cheap provider adds back in.
Square Payroll true monthly cost compared to cheap competitors with time tracking
The honest comparison for hourly workforces is "payroll + time tracking", because hourly payroll without time tracking is not real. Sources: Square Payroll, Gusto, Homebase, April 2026.
| Employees | Square / mo | Homebase / mo | Gusto Plus + Time / mo |
|---|---|---|---|
| 1 | $41 | $46 | $92 |
| 3 | $53 | $58 | $116 |
| 5 | $65 | $70 | $140 |
| 10 | $95 | $100 | $200 |
| 15 | $125 | $130 | $260 |
| 25 | $185 | $190 | $380 |
Square and Homebase are within $5 a month at every headcount. Gusto Plus is roughly double. For an hourly workforce, Square or Homebase is the cheapest honest path.
Why bundling time tracking is the single biggest cost trick in cheap payroll
Almost every cheap payroll provider advertises a sticker price that excludes time tracking. Patriot Basic at $17 looks cheaper than Square Payroll at $35. The reality for an hourly workforce is that you need time tracking either way, and the question is whether you pay for it inside the payroll plan or separately.
Patriot's time-and-attendance add-on is $6 per employee per month. Gusto's time tracking is bundled only in Plus at $80 + $12. QuickBooks Payroll Core does not include time tracking; QuickBooks Time costs $20 + $10 per user as a separate subscription. OnPay supports integrations with When I Work and other tools but each adds its own subscription cost.
Square Team is included free with Square Payroll. For a 10-employee restaurant, the time tracking that would cost $60 to $120 a month elsewhere is $0 here. That single inclusion is the cheap-edge argument for Square Payroll, and it is the reason it lands in this cheapest comparison even with a $35 base higher than Patriot Basic.
Square Payroll inclusion list at $35 + $6
- Federal and state tax filing. 941, 940, 944, state unemployment, state income withholding. Files on your behalf.
- Year-end W-2 and 1099-NEC filing. Included. No per-form charge.
- Square Team time tracking. Included. Time clock, scheduling, break enforcement, overtime calculation.
- Same-day direct deposit. Included for businesses with a Square Checking account, next-day otherwise.
- Tip handling. Automatic from Square POS, manual entry otherwise. Tip credit calculations supported.
- Multi-state payroll. Supported. No per-state surcharge.
- Workers comp pay-as-you-go. Via AP Intego or NEXT, billed separately by the carrier.
- 401(k) integration. Through Guideline, billed separately.
- Contractor-only plan. $6 per contractor with no base fee. Skip the $35 base entirely if you only pay 1099s.
- Mixed roster support. Pay W-2 employees at $35 + $6 and 1099 contractors at $6 each on the same bill.
Honest trade-offs
Square Payroll's UX and brand are built for retail and food service. If your business is a professional services firm with a salaried-only team in an office, Square Payroll works but feels out of place. Gusto's UX is built for that audience. The price difference is small enough that the UX fit can justify Gusto for salaried-only teams.
Square does not have a strong HR-advisory offering. Gusto Plus, ADP Run, and QuickBooks Payroll Premium all bundle some level of HR support. Square does not. For businesses making their first manager hires and wanting HR guidance, Square is the weaker choice.
The deepest argument against Square is platform lock-in. If your payroll is on Square and your POS is on Square and your banking is on Square Checking, you have built a single-vendor dependency. The integration value is real but the switching cost is commensurately high. For businesses that value vendor independence, OnPay's standalone payroll product is cleaner.
Cohorts where Square Payroll is the unambiguous cheapest answer
Restaurants and bars on Square POS. The tip flow from POS to paycheck is automatic, the tip credit math is correct, time tracking is free, and the price is the lowest in the market. See cheapest payroll for restaurants for the head-to-head.
Retail single-store operations with an hourly staff. Same logic as restaurants minus the tip handling. Square Team scheduling is solid for shift-based teams.
Mixed W-2 and 1099 rosters where you do not want to pay full per-head on the contractors. Square's contractor-only rate of $6 per contractor on the same bill as your W-2 employees is meaningfully cheaper than Gusto's mixed-roster handling.
Contractor-only businesses. The $6-per-contractor, no-base-fee plan is the cheapest legitimate contractor payment option in the US market alongside Gusto Contractor-Only. See cheapest payroll for contractors.
Other cheapest-vendor breakdowns
Cheapest Gusto plan
Simple at $40 + $6, multi-state trap
Cheapest OnPay plan
Flat $40 + $6, multi-state included
Cheapest Patriot plan
Basic at $17 + the $30 tax add math
Cheapest Wave Payroll plan
Self-service $20, 14-state map
Cheapest payroll for restaurants
Square + Homebase + Toast side by side
Cheapest payroll for daycare and childcare
Hourly staff, state licensing
Common questions
How much does Square Payroll cost?
Square Payroll is $35 per month base plus $6 per employee. There is one tier. Time tracking, same-day direct deposit, tax filing, and year-end W-2 filing are all included.
How much does Square Payroll cost for 5 employees?
Square Payroll at 5 employees is $35 + (5 x $6) = $65 per month, or $780 per year. Time tracking is free via Square Team. No year-end W-2 fees on top.
Does Square Payroll include time tracking?
Yes. Square Team Plus is included for free with Square Payroll. Square Team is the time clock and scheduling tool. This is the single biggest cost advantage for restaurants and other hourly workforces where time tracking is a mandatory expense.
Does Square Payroll handle tips?
Yes. If you use Square POS, tips flow automatically from the POS into the payroll run with the correct tip-credit treatment for the state. Even without Square POS, Square Payroll supports manual tip entry and tip-credit calculations.
Is Square Payroll cheaper than Gusto?
Square at $35 + $6 is $5 per month cheaper than Gusto Simple at $40 + $6. The bigger gap is time tracking. Gusto Simple does not include time tracking. Gusto Plus does, at $80 + $12. So for hourly workforces, Square is meaningfully cheaper than the Gusto plan you would actually need.
What does Square Payroll require?
Nothing technically. You can use Square Payroll without using any other Square product. In practice the strongest case for Square Payroll is when you already use Square POS, because the tip and time integration is automatic. Without Square POS, Homebase Payroll is a closer competitor.