Running payroll is one of the most delicate jobs in a small business. Between award rates, leave entitlements, super guarantee, and Single Touch Payroll (STP) reporting, there is plenty of room for small mistakes that quickly become costly ones. The right payroll software takes most of that manual effort off your desk — calculating pay accurately, keeping records secure, and reporting to the ATO on time.
With so many options on the market, it can be hard to know where to start. This guide compares the best payroll software for small business owners in Australia in 2026 — what each platform does well, where it falls short, and how to pick the right fit for your business.
Key takeaways
- Xero Payroll, MYOB, QuickBooks Online, Employment Hero, and Reckon One are among the most widely used payroll platforms for Australian small businesses.
- Every employer must report wages through STP Phase 2, so an STP-approved payroll platform is effectively a requirement, not an option.
- The super guarantee rate is 12%, and from 1 July 2026 super must be paid on payday alongside wages.
- Look beyond the monthly price — integrations, award handling, leave, and employee self-service matter just as much.
- Match the software to your business size, structure, and payroll complexity — not the other way around.
Why payroll software matters for your small business
Reliable payroll software is essential for the efficient running of your business and for keeping your team paid correctly, on time, and in compliance. Here's what a good payroll platform brings to the table:
- Accurate tracking and payment of wages, allowances, leave, and entitlements — with tax calculated in a few clicks.
- Serious time savings, as automated pay runs replace hours of manual spreadsheets and data entry.
- Fewer errors, because the software removes the mistakes that come from manual calculation, such as underpayments or missed super.
- Secure, cloud-based records that employees and managers can access from anywhere.
- Compliance built in — STP reporting, PAYG withholding, super payments, and payslips are handled automatically.
Single Touch Payroll Phase 2 has been mandatory for all employers since 1 January 2022. Reporting can only be lodged through software registered for STP, which makes choosing an STP-approved payroll platform essential.
The best payroll software options in Australia
The five platforms below are among the most widely used payroll solutions for Australian small businesses in 2026. All support STP reporting and cloud-based processing, but each suits a different type of business.
| Payroll software compared at a glance | |||
|---|---|---|---|
| Software | Best for | Standout strength | Watch out for |
| Xero Payroll | Businesses already using Xero for accounting | STP and payroll live inside your existing Xero file | Payroll sits on higher Xero plans only |
| MYOB | Local teams wanting accounting and payroll together | Australian payroll features with STP reporting | Payroll can be an add-on in some MYOB products |
| QuickBooks Online Payroll | New and micro businesses watching their budget | Straightforward setup and clean accounting integration | Fewer advanced local award features |
| Employment Hero | Growing teams that also need HR and leave | All-in-one HR, leave, onboarding, and STP payroll | More features than a tiny team may need |
| Reckon One Payroll | Cost-conscious small businesses | Flexible, budget-friendly module pricing | Smaller ecosystem and fewer integrations |
Xero Payroll
Xero is one of Australia's most widely used cloud accounting platforms, and its built-in payroll module is a natural fit if your business already runs on Xero. Pay runs, leave, STP reporting, and super clearing accounts all live inside the one file, so there's no syncing between separate systems.
Pros
- Payroll, accounting, and STP in one connected system.
- Clean, easy-to-use interface that your bookkeeper likely already knows.
- Leave and timesheets integrate directly with pay runs.
Cons
- Payroll is not available on Xero's entry-level plan.
- Very complex or award-heavy pay structures can need specialist help.
MYOB
MYOB has been a fixture of Australian accounting for decades, and its cloud range — MYOB Business and MYOB AccountRight — includes payroll with STP reporting. It's a strong choice if you want bookkeeping and payroll handled by one local platform.
Pros
- Accounting and payroll in the same suite.
- STP Phase 2 reporting built in.
- A long track record in Australian payroll and tax.
Cons
- Some products require a payroll add-on.
- The interface can feel more dated than cloud-first rivals.
QuickBooks Online Payroll
QuickBooks from Intuit offers payroll as an add-on to its popular QuickBooks Online accounting product. It's an affordable, straightforward option for micro businesses that want pay runs, STP, and super tracking without a large feature set.
Pros
- Budget-friendly payroll add-on to QuickBooks Online.
- Simple setup and clean integration with your accounting file.
- Mobile app for approvals and timesheets.
Cons
- Fewer advanced award and workforce features than specialist payroll platforms.
- Local payroll depth is thinner than Xero or MYOB.
Employment Hero
Employment Hero has grown quickly in Australia by combining payroll with HR — onboarding, leave, performance reviews, and a self-service employee app — in one platform. If your payroll pain is really an HR pain, this can be a great fit.
Pros
- Payroll, HR, onboarding, and leave in one place.
- Strong employee self-service and mobile app.
- STP Phase 2 reporting supported.
Cons
- The wider feature set can be more than a very small team needs.
- Pricing can rise as you add HR modules.
Reckon One Payroll
Reckon One is an Australian-made cloud accounting platform with a payroll module, and it's one of the more affordable ways to run STP payroll. You pay for the modules you need, which suits simple payroll setups.
Pros
- Low-cost, flexible module pricing.
- STP reporting supported.
- Simple to use for straightforward pay runs.
Cons
- Smaller ecosystem and fewer integrations than the big names.
- Advanced award and HR features are limited.
Managing payroll data efficiently with cloud payroll
Handling payroll information can be a time-consuming and complicated process — but it doesn't have to be. Streamlining your payroll workload doesn't necessarily mean hiring extra staff; a good cloud payroll solution can revolutionise the way you process pay and manage data.
Automating the mundane tasks and giving managers access to up-to-date information takes the headache out of payroll management, bringing cost savings and greater accuracy to teams of any size. Managing large volumes of complex data — hours, allowances, leave, super, and STP — becomes far easier when the software does the heavy lifting.
How to choose the right payroll software for your business
If you're in the market for payroll software, keep a few things in mind. First, what kind of business do you have? Your structure, industry, and headcount dictate the scope and complexity of your needs. Second, which features matter to you? Make sure the software has everything you need — STP, super, leave, employee self-service — and nothing you don't. Finally, consider the total cost, not just the headline price.
Work through this checklist before you sign up:
- Match the plan to your headcount. Per-employee pricing adds up as your team grows.
- Check STP and super features. Both are non-negotiable for Australian employers.
- Look at integrations with your accounting software and bank feed.
- Consider who will run it. Your bookkeeper or accountant's familiarity with the platform matters as much as the price.
- Use free trials to test the interface with your actual pay runs before committing.
Payroll should be easy — let us help you get it right.
Book a call with CleanSlate and we'll help you choose, set up, and run the right payroll software for your business.
Partner with CleanSlate for payroll without the headaches
Payroll shouldn't be a source of stress. CleanSlate handles payroll setup, processing, and compliance for Australian small businesses, working in the platforms you choose — so your team is paid accurately and your ATO obligations are met on time, every time.
Here's what we bring to the table:
- Payroll setup and configuration – we help you get STP, super, and pay items right from day one.
- Accurate pay runs every cycle – wages, leave, allowances, and PAYG calculated and checked before you pay.
- Super guarantee compliance – including the new payday super requirement that starts 1 July 2026.
- STP reporting handled – lodgements are made to the ATO on time, every time.
- Software selection advice – we recommend the platform that fits your size, budget, and structure.
By working with us, you gain more than compliance — you gain the freedom to focus on running your business. Get in touch with us today and take the stress out of payroll.
Payroll software FAQs
The most widely used payroll platforms in Australia are Xero Payroll, MYOB, QuickBooks Online Payroll, Employment Hero, and Reckon One. The best choice depends on your business size, payroll complexity, budget, and the accounting software you already use.
In practice, yes for most employers. Every employer must report wages to the ATO through Single Touch Payroll (STP) Phase 2, and STP can only be lodged through approved payroll or accounting software. Payroll software also makes super, PAYG withholding, and payslip obligations far easier to meet.
Look for automated pay runs, STP Phase 2 reporting, super guarantee calculation and clearing, leave tracking, payslips, tax calculations, and employee self-service. Integration with your accounting software is also important so payroll flows straight into your books.
Yes. Payroll software calculates super guarantee (12% since 1 July 2025), helps you record and clear super payments, and, from 1 July 2026, supports paying super on payday as the ATO requires.
Yes. CleanSlate helps small businesses choose, set up, and run payroll software — including STP registration, pay item setup, and ongoing pay runs — so your team is paid correctly and your ATO obligations are met.
