What a payroll provider handles
- Calculating gross-to-net pay, deductions, overtime, bonuses and leave pay.
- Payslips and year-end forms for employees.
- Payroll tax and social security filings and payments to the authorities.
- Pension or retirement plan deductions, and benefits.
- Starters, leavers, and statutory payments such as sick and parental pay.
- Reports for your accountant and your general ledger.
Payroll rules differ by country
- United States: federal, state and sometimes local income tax withholding, FICA, and filings such as Form 941 and Form W-2.
- United Kingdom: PAYE through Real Time Information (RTI) reporting to HMRC on or before each payday, National Insurance, and workplace pension auto-enrolment.
- European Union: each country sets its own income tax and social security rules, and many have collective agreements that affect pay.
- Elsewhere: check whether you need a local entity or a local registration before you can run payroll at all.
If you want to employ someone in a country where you have no company, an employer of record may be the simpler route.
Types of payroll service
- Payroll bureau: a specialist runs payroll for you each period.
- Software plus support: you run payroll in cloud software, with expert help on hand.
- Global payroll aggregator: one provider coordinates payroll across several countries through in-country partners.
- Employer of record (EOR): a provider legally employs your staff abroad and runs their payroll.
- PEO (mainly US): a co-employment arrangement that bundles payroll, benefits and HR.
Questions to ask a payroll provider
- Which countries and states do you cover directly, and which through partners?
- Who is responsible if a filing is late or wrong?
- What are the cut-off dates each pay period?
- How do you secure employee data, and where is it stored?
- Does it connect with our HR and accounting software?
- What does it cost per employee, per run and for year-end?
See our payroll outsourcing checklist for the full list.
What affects the cost
Pricing usually depends on headcount, pay frequency, the number of countries, and extras such as benefits administration or year-end work. Get a written quote that covers set-up, each pay run and year-end, so you can compare like with like. Our in-house vs outsourcing calculator helps you weigh it up against doing payroll yourself.
Last updated: 16 October 2026
