For any business with employees, running payroll every pay period is an important, but often tedious task. Some firms can afford to have an employee assigned to run payroll and manage employees, while others may opt to hire a payroll firm. But for many small businesses, the cost of these options is too high. 

Thankfully, there is another option: Online payroll services, like Square Payroll. Square Payroll lets you quickly and easily pay employees, track time, file payroll taxes, and much more – all from one intuitive online platform. 

In this Square Payroll review, we will cover everything you need to know about this popular payroll solution, including features, pricing, customer service, and more. 

Square Payroll is a division of Square, the popular payments processing service that offers Square point of sale systems, online payments, and more. While it integrates with other Square services, Square Payroll is a standalone product – meaning that you don’t need to use any other Square services in order to use their Payroll product.

Square Payroll offers full-service payroll, automated payroll tax filings, employee benefits management, and more, all in one place. They handle all tax filings and even mail W2s and 1099s. You can use the service to pay employees or contractors via check, direct deposit, or Cash App. 

Basically, this service offers everything you need to efficiently manage and pay your employees and contractors. It takes the place of a traditional payroll firm, at a small fraction of the cost. It’s very user-friendly, allowing just about anyone to use it. 

Check out our roundup of the Best Payroll Services for Small Business

How Square Payroll is different

There are many payroll solutions on the market. What sets Square Payroll apart from the competing payroll software providers, like Gusto? 

No contracts

Square does not require you to sign a contract or a long-term commitment, so you are free to cancel at any time. Many competitors have long-term contracts.

No setup costs

Square has a simple pricing structure that has no setup or initiation costs. Many competitors have hefty upfront costs in order to handle onboarding onto their system. 

Paused billing & seasonal businesses

Square allows you to “pause” services at any time, and you won’t pay a dime if you are not paying employees through the service. This is particularly useful for seasonal businesses, which may only need the service for a few months out of the year. 

More than just payroll

Square Payroll offers far more than just an easy way to pay your employees. Manage time tracking and timesheets for team members with Square Teams, mail out tax forms for tax season, manage employee benefits like retirement plans, and much more. 

Who Square Payroll is best for

Square Payroll is a great choice for just about any business that needs to pay employees, but here are some of the business types that can benefit most:

Businesses of all sizes

Square offers useful tools for businesses of all shapes and sizes. Small firms can benefit from the low cost and the versatility of the product, while large firms can enjoy some of the more advanced enterprise-level features. 

Seasonal businesses

Seasonal businesses, like Christmas tree sellers, ice cream trucks, etc. can greatly benefit from the flexibility of Square Payroll. The service can be paused at any time, with no costs incurred. So, you can use it when you need it, and pause it when you don’t – and you won’t be charged anything if you’re not actively paying employees or contractors. 

Square users

Businesses who already use Square’s products (POS systems, payments processing, Square Invoicing, etc.) will find it very easy to also use Square Payroll. All of Square’s services integrate together seamlessly, creating a more efficient workflow. While existing Square users will benefit from this efficiency, keep in mind that it’s not required to use any other Square product in order to use Square Payroll.

Businesses with employees & contractors

Any payroll service can help you pay your employees, but Square makes it simple to pay both W-2 employees and 1099 contractors, from the same platform. Adding a new payee is only $5 per month, so it’s cost-effective even for companies with dozens of contractors and employees. 

Square Payroll features

Square Payroll has all of the tools and features that business owners will need to efficiently pay their employees (or contractors), plus lots more. Here are some of the key features of the service:

Full-service payroll

Square offers full-service payroll. This means that it’s not just a way to pay your employees, but also a way to effortlessly stay on top of tax filing requirements. Manage different pay rates for different salary or hourly employees, deliver pay stubs, and pay employees by check, direct deposit, or Cash App. 

Automatic tax filings

Square handles payroll tax filings for you, based on the payments you make through Square Payroll. All federal payroll responsibilities are handled, with both quarterly and annual tax filings. State and local payroll tax returns are also filled automatically (although you may have other tax filing requirements).

Employee benefits

Square makes it simple to issue and manage employee benefits through the service. This includes retirement and health insurance benefits, sick leave, paid time off (PTO), and even Workers’ Compensation insurance. 

Automatic hour tracking

Square makes it easy to track hours for your employees. You can import timecards from select third-party partners, or from the Square POS or Square Team mobile app for Android and iOS. 

Seamless integrations

Square Payroll integrates seamlessly with other Square services. Plus, third-party applications like Intuit QuickBooks and Xero also sync up, making it easier to keep your books straight. 

Pay your way

Square’s simple payroll solutions mean that you can issue payments via direct deposit, check, or Cash App, all without any extra fees. Select different payment methods for different employees to keep everyone happy.

Square Payroll pricing

Square Payroll offers a simple, flat-fee pricing structure with no hidden costs. The total monthly cost will depend on how many employees/contractors you are paying, but even for larger companies, prices are very reasonable. 

Pay employees & contractors – $29 per month + $5 per month per person you pay

  • Pay all your employees or contractors
  • The flat $29 fee per month covers the basics of the service
  • Additional $5 per month per person you pay (contractor or employee)
  • Includes unlimited payroll runs per month
  • Full-service payroll
  • No commitment; cancel any time

Pay contractors – $5 per month per person you pay

  • Pay contractors only
  • $5 per month per person you pay (contractors only)
  • Includes unlimited pay runs per month
  • No monthly fees
  • No commitment; cancel any time

Overall, Square Payroll costs are quite reasonable and are generally in line with industry standards for online payroll services. Compared to a traditional payroll firm, Square is substantially cheaper. Another big benefit is that there are no contracts, no hidden fees, and no setup or early termination fee. 

Square Payroll customer service

Square does offer customer support, available via phone or email during normal business hours. However, there are many complaints about it being difficult to contact them. Customers will typically need to go through an automated system, and reports indicate that it can sometimes be difficult to reach a representative on the phone. 

The lack of quality customer service is one of the biggest drawbacks to Square. Fortunately, their products are quite intuitive and generally work quite well, meaning that customer service is rarely necessary. There is an extensive resource library and FAQs, which you can use to seek out answers to common questions and issues. 

Pros and cons of Square Payroll

When you select a payroll service to use, you will likely want to stick with it long-term, for simplicity’s sake. For this reason, it’s wise to weigh the advantages and disadvantages of a service. Here are some key pros and cons for Square Payroll: 


  • Full-service payroll from an easy online platform
  • Low monthly costs with clear, transparent pricing
  • No contract; cancel any time
  • Unlimited pay runs per month
  • Pay both employees and contractors easily
  • Manage employee benefits
  • Square mails out tax forms to payees, including W2s and 1099-Misc forms
  • Pay by check, direct deposit, or Cash App
  • Timecard management and employee app
  • Integrates with other Square services, and with bookkeeping services like QuickBooks Online


  • Mediocre customer support
  • Costs scale by the number of employees