Payroll software cost per employee in Canada: worked monthly estimates for 6, 25 and 80 staff

The monthly cost of payroll software for a Canadian employer is roughly employees paid × price per employee + base fee + add-ons, plus any per-run or year-end fees spread over the year. Because the per-employee price varies so much by software type and tier, the useful number is a range for your own profile, not a single "average". Below are three worked profiles (invented composites, with illustrative prices) that show how the pieces combine and which choices move the total most. Use the monthly cost estimator to run your own.

This guide is part of the payroll software selection checklist. No figure here is a vendor's price.

The formula and the inputs that matter

Monthly cost = (employees paid × price per employee per month) + base fee + module fees + (per-run fees × runs per year ÷ 12) + (year-end fees ÷ 12)

Input	Where to find it	Common trap
Employees paid	Your payroll register, by month	Counting only full-time staff
Price per employee	Vendor price page or quote, for the tier you need	Using the entry tier's price
Base fee	Price page or order form	Hidden in "starting at" pricing
Module fees	Time, scheduling, onboarding, benefits	Priced per employee on top of the tier
Per-run fees	Full-service quotes	Off-cycle runs cost extra
Year-end fees	T4, T4A, RL-1	Charged per slip or flat

Before tax. Add GST/HST, QST or PST separately (see GST/HST and USD pricing).

Profile 1: a 6-person professional office in Calgary

Salaried staff, semi-monthly pay, one province, no time tracking needed. The owner wants payroll done correctly and T4s filed, nothing more.

Option (illustrative)	Calculation	Monthly	Yearly
Payroll module in accounting software	6 × $6 + $0 base	$36	$432
Standalone payroll, self-serve	6 × $5 + $40 base	$70	$840
Full-service payroll	$45 per run × 24 runs ÷ 12 + 6 × $2	$102	$1,224

At this size the base fee dominates: the standalone option's $40 base fee is more than its per-employee charges. A module or a no-base-fee plan is often the best fit, provided it handles ROEs and electronic T4s. With five slips or fewer the employer could also file T4s through the CRA's free Web Forms, but at six it must file electronically.

Profile 2: a 25-person retail business in Ontario

Hourly staff with overtime and statutory holiday pay, biweekly pay, some turnover (so several ROEs a year), managers want staff to see pay stubs and request time off online.

Option (illustrative)	Calculation	Monthly	Yearly
Payroll only	25 × $6 + $45 base	$195	$2,340
Payroll plus HR records and self-service	25 × $10 + $45 base	$295	$3,540
All-in-one with time and scheduling	25 × $18 + $0 base	$450	$5,400
Payroll plus HR + separate scheduling app	$295 + 25 × $3	$370	$4,440

Here the choice is about features, not base fees. If managers currently spend hours building schedules and re-keying hours into payroll, the scheduling and time features may save more than the $155 a month difference between the HR tier and the all-in-one. The payback calculator helps test that. See HR features, self-service and scheduling.

Profile 3: an 80-person employer in British Columbia and Quebec

Two locations: 60 employees in BC, 20 in Quebec. Mix of salaried and hourly staff, a group benefits plan, an HR generalist who runs payroll. Needs RL-1 slips, French self-service for Quebec staff and a link to the accounting system.

Cost line (illustrative)	Calculation	Monthly
Payroll plus HR tier	80 × $12	$960
Time and attendance module	80 × $4	$320
Accounting integration	Flat	$50
Year-end slips (T4 and RL-1)	100 slips × $3 ÷ 12	$25
Monthly total		$1,355
Yearly total	$1,355 × 12	$16,260

At this size, small differences in the per-employee price matter: $1 per employee per month is $960 a year. It also becomes worth negotiating a multi-year price with a renewal cap (see contract renewal and exit terms). BC PST may apply to the subscription and Quebec QST to services supplied there, so ask how the vendor taxes a two-province customer.

Sensitivity: what moves the total most

Using Profile 2 (HR tier, $295 a month):

Change	New monthly	Difference
Headcount grows to 35	35 × $10 + $45 = $395	+$100
Price per employee $2 higher at renewal	25 × $12 + $45 = $345	+$50
Vendor counts 8 inactive seasonal profiles	33 × $10 + $45 = $375	+$80
Annual prepay at 10% off	$295 × 0.9 = $265.50	−$29.50

Headcount and billing definitions usually matter more than the headline discount. That is why the pricing models guide recommends getting the definition of a billable employee in writing.

From monthly cost to total cost

The monthly estimate covers only the subscription. A full comparison adds setup, data migration, training, internal time during the switch and renewal increases over the period. The three-year total cost guide builds those in for Profile 2.

FAQ

Is there a typical price per employee for payroll software in Canada?

Prices vary widely by type (payroll-only to full HR suites), tier, headcount, term and negotiation, and they change often. We do not publish an average because we cannot verify one; use vendors' current price pages and written quotes for your profile.

Do I pay for employees on leave?

Under "paid in the month" billing, usually not; under "active profile" billing, often yes. Ask, especially if you have employees on long parental or disability leave.

Should contractors be included in the employee count?

Only if the vendor charges for them. Some tools pay contractors and issue T4A slips at no extra cost, others charge a per-contractor fee.

How do I compare a per-run quote with a per-employee quote?

Convert both to a yearly total for your pay frequency and headcount, as in Profile 1, then divide by 12. Add year-end and off-cycle charges to both.

Sources

Canada Revenue Agency — electronic filing threshold for T4 slips, Web Forms
Government of British Columbia — PST on software
Revenu Québec — QST and RL-1 obligations
Government of Ontario — Employment Standards Act: overtime, public holiday pay