Cost Estimates, Worked Examples and Selection Checklists
Payroll-only, HR suite, full-service or accountant-run: which payroll set-up fits a Canadian employer?
Payroll-only, HR suite, full-service, accountant-run or employer of record: which payroll set-up fits by headcount, provinces and pay complexity.
The best-fit payroll set-up depends mostly on who will do the work and how complex your pay rules are. As a rule of thumb: a payroll module in your accounting software or a self-serve payroll tool suits small teams with simple pay in one province; a payroll plus HR suite suits growing employers who need records, time off and self-service in one place; an all-in-one with time and scheduling suits hourly, shift-based workforces; full-service payroll or an accountant-run payroll suits owners who want someone else to run each cycle; and enterprise HCM suits large, multi-province or unionised employers. Foreign companies with a few Canadian staff sometimes use a global payroll or employer-of-record service. Each type has a typical gap you should test.
This guide is part of the payroll software selection checklist. We describe types, not named products.
The types side by side
| Type | Who runs each pay run | Typically included | Typical pricing pattern | Typical gap |
|---|---|---|---|---|
| Payroll module in accounting software | You | Pay calculations, deposits, stubs, slips | Add-on, often per employee | ROE automation, multi-province, Quebec, HR features |
| Self-serve payroll SaaS | You | Payroll, remittance reports, T4s, ROEs, employee portal | Base fee + per employee | HR depth, scheduling |
| Payroll plus HR suite | You or your HR person | Payroll plus records, documents, time off, onboarding | Per employee by tier, modules | Paying for unused modules |
| All-in-one with time and scheduling | You and managers | Above plus scheduling, time clocks, attendance | Higher per employee, modules | Implementation effort, hardware for time clocks |
| Full-service or assisted payroll | Provider, with your inputs | Processing, remittances, filings, support | Base + per employee or per run | What is covered; change and correction fees |
| Accountant- or bookkeeper-run | Your accountant | Processing on their software | Per run or monthly retainer | Turnaround, data ownership, key-person risk |
| Enterprise HCM | Payroll and HR teams | Payroll, HR, benefits, analytics, workflows | Multi-year per employee + implementation | Long projects, minimum commitments |
| Global payroll / employer of record (EOR) | Provider (EOR becomes legal employer) | Hiring without a Canadian entity | Often USD per employee per month; EOR markedly higher | Canadian depth, provincial rules, FX |
Compare the same types on the comparison page.
Decision rules by situation
| If your situation is… | Start by considering… | Then test… |
|---|---|---|
| 1–5 salaried staff, one province, monthly or semi-monthly pay | Accounting payroll module or no-base-fee self-serve payroll | ROE and electronic T4 filing |
| 5–50 staff, mostly salaried, little turnover | Self-serve payroll, or payroll plus basic HR | Year-end fees, export of history |
| 15–150 hourly staff, shifts, tips or overtime | All-in-one with time and scheduling, or payroll + separate scheduling | Overtime and holiday pay rules per province, time import |
| Staff in Quebec as well as other provinces | Any type with proven QPP, QPIP, RL-1 and French support | RL-1 file, HSF calculation, French self-service |
| Owner has no time or interest in payroll | Full-service payroll or accountant-run | Responsibility for errors, cut-off times |
| 150+ staff, union agreements, several provinces | Enterprise HCM or a strong mid-market suite | Rules engine, implementation plan, references for similar complexity |
| Foreign company, 1–10 people in Canada, no entity | Global payroll (if you register as employer) or EOR | Provincial employment standards, benefits, cost in CAD |
| Federally regulated employer | Any type that supports Canada Labour Code standards | Vacation, holidays and overtime under the Code |
Self-serve or full-service?
The difference is less about software and more about responsibility for doing the steps:
- Self-serve: you enter hours and changes, approve the run, and the software calculates, pays and prepares filings. Some tools remit and file automatically once you approve.
- Full-service: you send inputs by a cut-off time; the provider processes, remits and files. You review the register.
In both cases, the CRA holds the employer responsible for deductions, remittances and filings. Full-service contracts often state that the provider will pay penalties caused by its own errors, but not those caused by late or wrong inputs. Read that clause before choosing full-service for peace of mind.
Payroll module or standalone payroll?
A payroll module inside your accounting software has one big advantage: payroll journals post straight to the ledger. Its common limitations are fewer HR features, less flexible pay rules and, in some products, limited ROE or Quebec support. A standalone payroll tool connected to accounting gives more payroll depth at the cost of an integration to maintain. See integrations with accounting, time and benefits.
HR suite: when the extra cost earns its keep
HR features save money when they replace real work: paper onboarding forms, emailed time-off requests, spreadsheets of vacation balances, manual schedule building, or chasing signatures on policies. If none of that is happening in your business, a payroll-only tool is usually the better fit. The HR features guide goes feature by feature, and the cost per employee examples show what moving up a tier costs.
Employer of record: a special case
An employer of record becomes the legal employer of your Canadian staff and handles payroll, deductions and filings, while the staff work for you. It suits a foreign company testing the Canadian market. Points to check:
- the EOR's knowledge of the provincial employment standards where your staff work;
- who holds the employment contract and how termination is handled;
- benefits offered, vacation pay and statutory holidays per province;
- the fee, often a significant monthly amount per employee in USD, and FX costs (see GST/HST and USD pricing).
Once a business has several Canadian employees, registering as an employer with a CRA payroll account and using Canadian payroll software is usually less expensive. Get tax and legal advice on permanent establishment and employment status.
FAQ
Can I change type later?
Yes. Many employers start with a payroll module and move to a standalone tool or suite as they grow. The cost is a switch: data migration, year-to-date balances and a parallel run. Plan it for a year or quarter start.
Is full-service payroll more accurate?
Not automatically. Accuracy depends on correct set-up and inputs. Full-service shifts processing work to the provider, but inputs such as hours, rates and terminations still come from you.
Do I need an HR suite to keep employee records?
No. Employment standards laws require you to keep certain records, but not in any particular system. A payroll tool's employee profile plus secure document storage can be enough for a small employer.
What about payroll for a non-profit or charity?
The payroll rules are the same. Non-profits often need fund or grant coding in the general ledger export, so test that integration, and check how GST/HST rebates affect the cost of the subscription.
Sources
- Canada Revenue Agency — employer responsibilities, payroll accounts, employee or self-employed rulings
- Employment and Social Development Canada — Canada Labour Code standards for federally regulated employers
- Revenu Québec — Quebec employer registration
- Innovation, Science and Economic Development Canada — business registration and small business information
