As a founder of a new-age company (NAC), you have countless responsibilities—from developing your product or service to hiring the right team and securing funding. However, one crucial aspect that often gets overlooked is payroll management.
Properly paying your employees on time and ensuring compliance with labour laws and tax regulations are essential for any business. Still, this can be especially challenging for startups with limited resources and rapidly evolving needs.
An efficient and reliable payroll system can save you from countless headaches and costly mistakes. Automating payroll processes is not merely about paying salaries on time but also compliance, tax filing, benefits management, and ensuring a seamless experience for the finance team and the employees.
In this article, we'll explore the top five payroll systems tailored for startups in 2025. Whether you're a bootstrapped startup or a well-funded venture, investing in the right payroll system can be a game-changer.
By streamlining this critical aspect of your business operations, you can focus on what truly matters: building a successful and sustainable company.
What Are the Key Criteria for Selecting Payroll Automation Software? A sound payroll system should tackle the immediate needs of your business, allowing you to run operations without a lot of overhead costs. There are several options available in the market, so we tested over 10 payroll systems for startups on the following criteria:
1. Automation Is The Key To Solving Time Constraints And Dependencies A robust payroll system should automate as many processes as possible, minimising the need for manual data entry and calculations. Look for systems that offer not just basic automation but intelligent features. For example, Mysa automates tax filings and deductions, ensuring you're always in line with the latest tax laws without updating your processes manually.
2. Scalability Is Crucial For Growing Startups Your payroll system should be your growth partner. As your team expands from a handful to hundreds, the system should adapt seamlessly. Consider how Gusto (formerly ZenPayroll) and Mysa scale with your business, offering features like multiple pay schedules and structures that cater to an expanding workforce without compromising efficiency.
3. Compliance Confidence Unless you want the authorities to show up and completely ruin your day, compliance needs to be bulletproof. Your chosen system should be a guardian, ensuring adherence to local, state, and federal laws. Razorpay, for instance, keeps tabs on changing legislation, automatically adjusting its processes to keep your business compliant.
4. User-Friendliness A system that’s a puzzle to use serves no one. Your choice of payroll system should be easy to use for everyone, not just the finance team. A quick, clean user interface goes a long way in improving efficiency and helpfulness, keeping payroll headaches to minor hiccups.
5. Integration is non-negotiable Often overlooked, integration is non-negotiable when it comes to enterprise-level software. Your payroll software will not operate in a vacuum–it should integrate seamlessly with all the other tools you use, from accounting to HR applications. The ability to sync with other tools in your arsenal reduces manual data entry and potential human errors.
Best Payroll Services for Startups in India for 2025 Here is the curated list of payroll services for Indian startups in 2025
Mysa RazorpayX Zoho Payroll Xero Gusto (formerly ZenPayroll)
Feature
Mysa
RazorpayX
Zoho Payroll
Xero
Gusto
Automation
Fully automated tax filings and deductions
Automated payroll processing and tax compliance
Comprehensive payroll features with automation
Integrates with payroll services for seamless accounting and payroll management
Full-service payroll automation
Scalability
Scales with your business
Supports businesses of all sizes
Easily scales within the Zoho ecosystem
Highly scalable, suitable for businesses of all sizes
Ideal for small businesses and scales with growth
Compliance
Keeps up with tax laws and regulations
Automatic updates with the latest tax regulations
Manages tax compliance and filings
Offers comprehensive financial reporting for compliance
Automated compliance and tax support
User-Friendliness
Intuitive interface and mobile app
Unified platform for financial operations
Cloud-based with easy integration into Zoho suite
User-friendly interface for easy financial management
Simple, clean interface with mobile access
Support
Robust support across various channels
Efficient customer service for financial management
Employee self-service portal and customer support
Strong customer support and online resources
Access to HR professionals and resources
Reporting
Insightful reporting tools for financial decisions
Detailed financial reporting and reconciliation
Advanced reporting and analytics features
Detailed financial reports and insights
Comprehensive reports and financial wellness tools
Integration
Seamless integration with HR and accounting tools
Consolidates financial operations on a single platform
Integrates with Zoho suite for seamless operations
Over 800 third-party app integrations, including payroll services
Integrates with third-party accounting and time-tracking apps
1. Mysa If you are looking for comprehensive payroll software, we'd be remiss if we didn't give Mysa a well-deserved shoutout. Our platform is quickly becoming a go-to for startups needing robust yet easy-to-use payroll services .
Here is why Mysa might be the perfect fit for your enterprise.
1. Robust automation capabilities
For starters, Mysa automates almost every payroll task under the sun. From automated tax calculations and filings to seamless integration with time tracking and HR systems, it ensures that your payroll runs smoothly without manual intervention.
2. Seamless integrations
Mysa plays well with others, integrating effortlessly with your existing suite of tools. From popular accounting tools like QuickBooks and Xero to HR platforms, it ensures a harmonious workflow, reducing the need for manual data entry and minimising errors. In addition, you can execute common payroll tasks right within Slack, such as applying and approving leaves, reimbursements, viewing payslips, etc.
3. Effortless scalability
Whether you're a team of 10 or gearing up to be the next big thing with hundreds of employees, Mysa grows with you. It's designed to handle the complexities that come with a growing team, ensuring that transitioning to a larger workforce is a breeze.
4. Compliance made easy
Keeping up with tax laws and statutory regulations can be a full-time job. Mysa takes this worry off your plate by staying up-to-date with the latest changes in legislation, ensuring that your startup remains compliant without any extra effort on your part.
5. Insightful Reporting
With Mysa’s comprehensive reporting tools, you can gain valuable insights into your payroll expenses. You can also make informed decisions with data on your labour costs, tax liabilities, and more at your fingertips.
2. RazorpayX RazorpayX has quickly become one of the most formidable players in the financial and payroll services sector for new-age, digital-first companies. It is renowned for its comprehensive features, which extend beyond payroll into payments, banking, and financial reporting.
Here's why RazorpayX could be the game-changer your NAC needs:
1. All-in-One Financial Platform
What sets Razorpay apart is its ability to consolidate multiple financial operations onto a single platform. From managing payroll and automating tax filings to facilitating payments and financial reconciliation, Razorpay offers a unified ecosystem for your company’s financial health.
2. Automated payroll processing
Razorpay Payroll emphasises automating payroll processing to ensure that your employees are paid on time. The platform can automate a number of tasks, such as calculating salaries, deductions, and tax filings, which significantly reduces the chances of errors.
3. Compliance made simple
Razorpay lets you manage employees, contractors, freelancers, and interns from the home dashboard, one of the most extensive ones we have come across. It handles all taxes, compliance payments and filings, automatically updates its system with the latest tax regulations, and provides detailed reports for transparency and audit readiness.
4. Superior employee experience
The platform also focuses on keeping your employees happy by enabling advanced payment features. Using the platform, you can directly pay your employees’ salaries to any bank account in India. In addition, it enables employee tax document verification, 1-click ITR Filing, and thorough documentation for Tax Liabilities.
5. Accounting tool integrations
One-click integration with accounting tools like Quickbooks allows you to create and sync Chart of Accounts, sync employee salaries, contractor payments and related compliances. You can also pay your invoices through RazorpayX and Sync back status to Quickbooks.
3. Zoho Payroll In India, Zoho Payroll is available as a standalone app and as a part of Zoho Books outside the country. It is a web-based cloud payroll software designed to automate and enhance payroll operations through its features. Let’s take a look at the features of this intuitive payroll software.
1. Seamless integration with Zoho Ecosystem
One of the biggest advantages of using Zoho Payroll is its native integration with the broader Zoho suite. This means if your startup already uses Zoho products for CRM, accounting, or HR, integrating payroll becomes a breeze, allowing for seamless data flow across platforms and eliminating the need for manual data entry.
2. Comprehensive payroll features
The platform does not skimp on payroll features. It does the basics absolutely flawlessly—from automating payroll calculations to handling tax compliance, benefits administration, and leave management, it provides a robust set of tools to manage your payroll end-to-end.
3. Employee Self-Service Portal
A standout feature of the Zoho Payroll software is the employee self-service portal, where employees can access payslips, tax information, and manage their details. This transparency builds trust and saves time for your HR department by reducing inquiries about payroll and benefits.
4. Highly customisable
Zoho Payroll also supports a diverse range of salary structures , making the app one of the most versatile ones on this list. You can easily create multiple pay slabs for managers and employees depending on their rank in your organisation, which streamlines pay hierarchies and facilitates faster payroll processing.
5. Advanced security protocols
Zoho Payroll prioritises security, employing advanced encryption and security protocols to protect your highly sensitive financial data. You get role-based access to your dashboard, enabling collaboration between admin, auditing, and finance teams effortlessly.
4. Xero Xero is one of the most popular finance tech organisations in the world, offering robust accounting and payroll software for small and medium businesses. Xero’s powerful, beautifully designed dashboard makes it easy for businesses of any size to manage their accounting and make informed decisions.
Here are some standout benefits of Xero Payroll:
1. Effortless Payroll Integration:
While Xero itself focuses on accounting, it offers robust integrations with leading payroll providers. This flexibility allows startups to choose a payroll solution that best fits their needs, ensuring a seamless connection between payroll and accounting.
2. Streamlined Accounting Features
Xero simplifies everyday financial tasks with features like easy invoicing, expense tracking, and bank reconciliation. Its dashboard provides a real-time view of your cash flow, making financial management both straightforward and transparent.
3. Cloud-Based Convenience
As a cloud-based platform, Xero offers the flexibility to manage your finances anywhere, anytime. Whether you're at the office or on the go, you have access to your financial data, ensuring that you're always in the loop.
4. Comprehensive Reporting
You gain access to detailed payroll reports that help you understand where your payroll dollars are going. From wage summaries to tax liabilities, these reports provide valuable insights that can inform your budgeting and financial planning.
5. Extensive App Ecosystem
Xero’s app marketplace offers over 800 third-party integrations, covering everything from payroll and HR to time tracking and ecommerce. This ecosystem allows startups to create a tailored set of tools that work seamlessly together, streamlining operations across the board.
5. Gusto (formerly ZenPayroll) ZenPayroll , now Gusto, is an online HR service solution that focuses on simplicity, automation, and a delightful user experience. It also offers robust payroll system features with advanced automation capabilities.
Here are some of the standout benefits of incorporating Gusto into your company.
1. Full-service payroll
The platform automates every aspect of payroll, including wage calculations, tax filings, and payments, ensuring accuracy and compliance with minimal effort. The platform is known for its simplicity and ease of use, allowing you to run payroll in minutes.
2. Comprehensive benefits management
Beyond payroll, Gusto provides a suite of integrated benefits management, including health insurance, retirement plans, and workers’ compensation. You can consult Gusto’s several licensed advisors with years of healthcare experience and decide whether to keep your existing plan or switch to a new one, etc.
3. Streamline HR
With Gusto, you can easily consolidate your employee data. Every crucial information, such as emergency contacts to new hire documents is available in a single dashboard. Moreover, your employees can access all the data at a glance and modify it, making it more transparent.
4. Nurture team growth with talent management
Gusto offers a suite of intuitive talent management tools that allow founders to evaluate employee performance and career development. Using these tools, you can create a work culture that motivates, nurtures, and helps your employees identify opportunities, develop skills, and grow in their careers.
5. Integrations with your favourite tools
Gusto integrates with your favourite third-party tools to unlock additional payroll functionality. These include ActiveCampaign for customer experience automation, Syft Analytics , Amplitude for collaborative product analytics, etc. Such seamless connectivity ensures that data flows seamlessly through your tools, thereby streamlining operations and reducing manual data entry.
Try Mysa Payroll System today According to a recent survey :
IT resources are spending 22 hours per week, per country, managing data flow between payroll and other business systems The average payroll accuracy rate is just 78% 31% say they can only access some data across their business, but it’s not standardised Don't let payroll complexities slow down your startup's growth. Mysa is here to streamline your payroll and onboarding processes, ensuring a smooth, efficient transition for your team as you scale.
Ready to see Mysa in action? Request a demo today and join the ranks of startups that have elevated their payroll processes with Mysa.
Simplify your payroll, empower your team, and focus on what you do best-growing your startup.
Frequently Asked Questions About Payroll Automation Software 1. What is payroll automation software? Payroll automation software uses technology to automate tasks like salary calculation, tax deductions, and compliance filings, making the payroll process faster, more accurate, and error-free. It handles everything from computing salaries (including overtime, bonuses, deductions) to filing taxes and disbursing payments directly to employee accounts.
Key features:
Automated salary processing Tax compliance (TDS, PF, ESI in India) Direct deposit payments via NEFT/RTGS Integrated HR functions (leave, attendance tracking) Employee self-service portals Error reduction via audit tools Popular Indian options: RazorpayX, Zoho Payroll, Mysa, Gusto, greytHR
2. What are the benefits of payroll automation software for startups? Time savings: Reduces payroll processing from 8–10 hours to under 30 minutes per monthAccuracy: 99%+ accuracy vs. 78% manualCompliance: Auto-updates with latest tax laws and files returnsCost reduction: Saves 40–60% on payroll processing costsEmployee satisfaction: Self-service portals for payslips, Form 16 downloads, leave applicationsScalability: Handles growth from 10 to 500+ employees without adding headcountReal-time insights: Dashboard for labour costs, tax liabilities, and department-wise tracking3. How does payroll automation software work? 5 automated steps:
Data Integration: Sync employee data from HRMS (salary, bank, PAN, Aadhaar)Attendance & Leave Sync: Auto-pull attendance, leaves, work hoursSalary Calculation: Computes gross salary, deductions (PF, PT, TDS), reimbursementsCompliance Processing: Files statutory deductions (PF @ 12%, ESI @ 0.75%, TDS, PT)Payment Disbursement: Generates salary files, pays via NEFT/RTGS/UPI, auto-emails payslipsResult: Zero manual intervention, full audit trails and compliance reporting
4. What features should I look for in payroll automation software? Must-have features for startups:
Automated salary calculation (CTC breakup, reimbursements, arrears) India tax compliance (TDS, PF, ESI, PT, LWF) Direct payment integration (NEFT/RTGS/IMPS) Employee self-service portal (payslips, Form 16, reimbursements) Leave & attendance integration Multi-location support (state-specific PT and labor laws) Accounting integration (Zoho Books, QuickBooks, Tally) Mobile access for approvals and queries 5. How much does payroll automation software cost in India? Pricing models:
Per-employee-per-month (PEPM): ₹50–₹200/employee (Zoho Payroll ₹60, RazorpayX ₹125)Flat monthly fee: ₹2,000–₹10,000/month for 50–100 employees (greytHR ₹2,995, Keka ₹6,999)Freemium options: Free for up to 5–10 employeesEnterprise custom pricing: 200+ employees, multi-entity featuresHidden costs: Implementation/onboarding ₹5K–₹50K, statutory filing charges, payment gateway fees ₹3–₹5 per transaction
ROI: Even ₹10K/month saves ₹50K+ annually
6. Is payroll automation software secure and compliant? Security measures:
256-bit SSL encryption Role-based access control Two-factor authentication (2FA) Regular backups and disaster recovery SOC 2 Type II and ISO 27001 certifications Compliance features:
Auto-updates for tax laws and PT revisions Pre-configured for PF, ESI, PT, TDS Audit trails for salary changes Digital signatures for Form 16, 12BB Integration with government portals (EPFO, ESIC, Income Tax) Risk mitigation:
Bank account validation to prevent duplicate payments Flags non-compliant salary structures Maintains 7-year payroll records 7. How long does it take to implement payroll automation software? Implementation timeline (10–50 employees):
Week 1: Setup & configuration (3–5 days) – account creation, data migration, salary setup, bank integrationWeek 2: Testing & training (3–4 days) – sample payroll runs, employee onboardingWeek 3: First live payroll (1–2 days) – process payments, verify deductions, distribute payslipsFast-track: 48-hour setup (vendors like Mysa, RazorpayX)
8. Can payroll automation software integrate with existing tools? Integration options:
Accounting software: Zoho Books, QuickBooks, Tally ERP, XeroHRMS platforms: Darwinbox, Keka HR, greytHR, BambooHRTime & attendance: Biometric systems, Clockify, Toggl, HubstaffBanking platforms: NEFT/RTGS bulk paymentsCommunication tools: Slack, MS Teams, WhatsAppBenefits platforms: Insurance, PF trusts, gratuity fundsTax portals: Income Tax e-filing, EPFO, ESICAPI availability: REST APIs for custom integrationsIntegration time: Pre-built connectors 1–2 hours; custom APIs 1–2 weeks
.svg)
.svg)
.svg)
.png)
.png)
.svg)
.jpg)
