Managed Payroll Services: The Complete UK Guide

Managed payroll services put the day-to-day running of your payroll in the hands of a specialist provider: calculating pay and deductions, reporting to HMRC, producing payslips and keeping pace with legislation, while you keep control of the data, the approvals and the decisions. It's one of those terms that sounds straightforward until you start comparing providers and realise everyone means something slightly different by it. This guide clears that up. It covers what managed payroll is, how the service models differ, what it costs, how to decide, how to choose a provider and what the move involves, with links to our detailed guides wherever you need more depth.

At a glance

Managed payroll means a specialist provider runs your payroll processing, HMRC submissions and legislative updates, while you supply the inputs, approve each run and stay in control of the decisions. > What managed payroll is
"Managed payroll" and "payroll bureau" mean different things to different providers, so compare services by who does each task, not by the label. > Service models explained
The biggest gains are usually compliance and continuity, not just time saved: specialists tracking every legislative change, and no single point of failure in your team. > What changes
Most providers charge per employee per month, with a separate one-off implementation fee. Costs vary with headcount, pay frequencies and complexity. > Costs and pricing
In-house payroll isn't free. Once you count salaries, software, training, cover and error correction, outsourcing often costs less, but it isn't right for every organisation. > How to decide
Choosing the right provider matters as much as the decision to outsource. Accreditation, UK expertise, service model, implementation approach, integration and references are what separate one provider from another. > Choosing a provider
You remain legally responsible for your payroll even when a provider runs it, which is why the quality of the provider, and of the information you give them, matters so much. > UK compliance

What is managed payroll?

A specialist provider runs the processing, submissions and outputs; you supply the inputs and approve each run.
Your legal responsibilities as an employer don't transfer to the provider.
Managed payroll is a step beyond running payroll software yourself or asking your accountant to "do the payroll".

Managed payroll (also called outsourced payroll or payroll outsourcing) is an arrangement where an external specialist runs your payroll for you under a contract with agreed service levels. Each pay period, you send the provider whatever changes pay: starters, leavers, salary changes, overtime, absence and deductions. The provider calculates gross-to-net pay, applies tax, National Insurance, student loan and pension deductions, reports to HMRC, and returns the results for you to check and approve.

What moves to the provider, and what stays with you

The provider typically handles the pay calculations, statutory payments such as Statutory Sick Pay and Statutory Maternity Pay, Real Time Information (RTI) submissions to HMRC, payslips, pension contribution files, year-end outputs such as P60s, and updating the system each time legislation or rates change. Many also answer employee pay queries and prepare the payment files for your bank.

You typically keep responsibility for supplying complete, accurate and timely inputs, approving the payroll before payments are released, funding net pay and your HMRC and pension payments, and the decisions behind the numbers: pay policy, pay awards, bonuses and benefits.

In practice: a 400-person retailer running a weekly payroll for store staff and a monthly payroll for head office sends its provider timesheet and change data by an agreed cut-off before each payday. The provider processes both payrolls, flags anything unusual (a negative net pay, an employee who has dropped below the National Minimum Wage, a missing tax code), and returns reports for sign-off. Once the retailer approves, the provider submits to HMRC, releases payslips and produces the payment and pension files. The retailer's team spends its time checking and approving rather than keying and calculating.

Important: GOV.UK is clear that, as an employer, you're legally responsible for completing all PAYE tasks even when you pay someone else to carry them out. A specialist provider helps reduce the risk of errors and missed deadlines through dedicated expertise, up-to-date systems and ongoing legislative monitoring. Accuracy still depends on the quality of the information you provide, but the day-to-day compliance burden shifts significantly.

How it differs from payroll software, a bureau and your accountant

Payroll software: you buy the system and your own team runs payroll. The software does the calculations and files with HMRC; the expertise, checking and cover are yours.
Payroll bureau: often used for a lighter or partly outsourced service, although the terms overlap heavily (more on that below).
Your accountant: many smaller employers have their accountant or bookkeeper run payroll alongside the accounts. It works well for simple payrolls; as headcount, pay frequencies and benefits grow, a payroll specialist usually brings deeper expertise and more capacity. If you employ a small team, our guide to payroll services for small businesses covers the options in detail.
Managed payroll: a specialist runs payroll as a continuous service, with named contacts, agreed service levels and responsibility for keeping the system compliant.

The labels, though, are where most of the confusion starts.

Managed payroll services, bureaus and hybrid models

Providers use "managed" and "bureau" inconsistently, so ask who does each task.
Most arrangements fall into one of three models: fully managed, bureau or hybrid.
The right model depends on your team's capacity and how much of the processing you want to keep.

The terminology can get a little hazy here. Some providers use "payroll bureau" to mean a lighter, partly outsourced service and keep "managed payroll" for the full version. Others use the two interchangeably, and you'll also hear "part-managed" and "co-managed". Confusing, right?

The simplest way through is to ignore the label and ask who does what. Who keys the data? Who checks it? Who submits to HMRC? Who produces the pension file? Who answers an employee when a payslip looks wrong? The answers tell you which model you're actually buying.

Service model	Who does what
Fully managed payroll	Provider: processing, checks and exception handling, HMRC and pension submissions, payslips, year-end and legislative updates, often employee queries. You: inputs and approval. Tends to suit: organisations without payroll expertise in-house, or that want their team focused elsewhere.
Payroll bureau	Provider: calculations, submissions and payslips, based on the data you send. You: data entry and validation, more of the checking, and often pensions and queries. Tends to suit: organisations with payroll knowledge in-house and simpler pay structures.
Hybrid	Provider: agreed parts of the process, or one payroll population while you run another, or specialist cover for your team using the provider's system. You: everything not agreed. Tends to suit: organisations with a capable team that need extra capacity, resilience or expertise.

No model is inherently better; each shifts a different amount of work. A lighter bureau service usually costs less per head but leaves more with your team, including cover when someone is off. A fully managed service moves more of the workload and more of the operational risk management to the provider, and costs more per head accordingly. Whichever you're offered, ask for the split of tasks in writing.

Which model suits you?

Example: a 60-person professional services firm with an experienced office manager who knows payroll might start on a bureau model, keeping data entry in-house. A 1,500-person manufacturer with shift patterns, two pay frequencies and a payroll team of two is more likely to need a fully managed service, or a hybrid in which the provider runs processing and the in-house team handles queries and approvals. The right answer usually changes as you grow, so it's worth asking whether a provider can move you between models without a new implementation.

If you'd rather keep processing entirely in-house, the alternative is to run payroll on your own system. Our guide to cloud payroll software covers that route.

Employ people in more than one country? The same models apply, but the question becomes whether one provider can run each country's payroll through a single contract and point of contact. Our international payroll services page explains how that works.

Whichever model fits, the reasons organisations make the move tend to be the same.

What managed payroll changes for your organisation

Compliance, accuracy and continuity are usually bigger gains than the time saved.
Growth, acquisitions and new pay frequencies become a question of the provider's capacity, not your recruitment.
In return, you give up some flexibility on process and timetables.

Pay is the foundation of trust between you and your people. When it goes wrong, it rarely feels like an admin error to the person affected; it feels like a broken promise. So the case for managed payroll starts with getting it right, every time.

Compliance keeps pace without your team chasing it. Payroll rules change every April, and increasingly mid-year too. New legislation is rarely a box-ticking exercise: it's often open to interpretation, which is testing for a small team. A specialist provider monitors changes, interprets them and updates the system before they take effect.

Accuracy comes from process, not heroics. Providers build checks, reconciliations and separation of duties into every run, so errors are caught before payday rather than after.

Your team gets time back. Their payroll role shifts from processing to reviewing and approving, freeing HR and finance for work that adds more value.

Expertise is on hand for the hard cases. Salary sacrifice, termination payments, statutory family pay and tax on benefits are routine for a specialist and occasional for most in-house teams.

Security and controls are independently checked. Established providers are audited against standards such as ISO 27001 for information security and ISAE 3402 for internal controls, which is hard for most in-house teams to match and useful evidence for your own auditors.

Reporting gets better, not worse. A common worry is losing visibility. In practice, a good provider gives you standard and custom reports on costs, headcount and variances, often with more consistency than a spreadsheet built in-house.

Scaling stops being a recruitment problem. Rapid growth, a new weekly payroll or an acquisition that brings a second PAYE scheme: a provider can flex capacity in a way a small fixed team can't.

Continuity no longer depends on one person. Many in-house payrolls rely on one or two people who know how everything works. When they're ill, on holiday or leave, the risk is immediate. Hertz, which has worked with us for 40 years, is one example of a payroll partnership that held steady through the disruption of the pandemic.

What you give up. You work to the provider's timetable and cut-off dates, some of your processes will be standardised, and you depend on a supplier's performance. Most of this can be managed with clear service levels, an agreed timetable and regular reviews, but it's worth going in with your eyes open. For a very large or highly specialised payroll, a strong in-house team can be better value. For the balanced view, see our guide comparing in-house payroll with outsourcing.

The next question is usually what it costs.

Costs and pricing

Most providers charge per employee per month (PEPM), plus a one-off implementation fee.
Headcount, pay frequencies, complexity and integrations drive the price.
Compare the full schedule of charges, not just the headline rate.

Most UK managed payroll providers price per employee per month (PEPM). Across the market, rates typically range from around £4 to £15 PEPM, with fully managed services commonly between about £5 and £12. Higher headcounts generally bring a lower rate per head. Some providers charge per payslip instead, which means weekly or fortnightly payrolls cost proportionally more because you pay for every run; very small payrolls are sometimes offered a fixed monthly fee.

On top of the ongoing fee, expect a one-off implementation fee covering data migration, configuration, testing and parallel running. In year one, it can be the largest single line.

What drives your price:

Headcount: the base of every quote.
Pay frequencies and pay groups: each extra cycle adds processing, submissions and checks. A 400-person employer paying 300 people weekly and 100 monthly runs around 16,800 payslips a year; pay everyone monthly and it's 4,800.
Complexity: shift premiums, overtime rules, salary sacrifice, benefits in kind and multiple PAYE schemes.
Scope and integrations: feeds from HR or time and attendance systems, employee query handling and pension administration.

Costs beyond the headline rate: what to ask about

Ask each provider for a full schedule of charges and check what's included in the core fee: year-end processing, out-of-cycle payments, pension submissions, reporting, and how annual price reviews work. Then compare quotes on the same scope over three years rather than on PEPM alone.

Key takeaway: the lowest headline rate isn't always the lowest total cost. For an instant estimate, try our payroll outsourcing cost calculator. For pricing models, worked examples and a full in-house comparison, read our detailed payroll outsourcing costs guide.

In-house or outsourced: how to decide

In-house payroll carries costs well beyond the team's salaries.
Outsourcing tends to become more cost-effective from around 20 to 30 employees, but cost isn't the only factor.
A hybrid model can add capacity without handing over the whole function.

In-house payroll isn't free; its costs are just spread across different budgets. Salaries and on-costs for your payroll team, software licences and upgrades, training to keep up with legislation, cover for holidays and absence, recruitment when someone leaves, time from HR, finance and IT, and the cost of putting errors right, including any HMRC penalties. Add them up and outsourcing often comes out lower, typically once you employ more than around 20 to 30 people.

But cost is only part of the picture. Four questions usually settle it:

Do you have the expertise in-house, and would you still have it if one person left?
How complex is your payroll, and how quickly is it changing?
How much control do you need over processing, as opposed to control over outcomes and approvals?
What else could your team be doing with the time payroll takes today?

Signs it's time to look at outsourcing

Payroll knowledge sits with one or two people, and nobody else could run it tomorrow.
Legislative changes are arriving faster than your team can build and test them.
Your software needs replacing or a major upgrade, which would mean re-implementing anyway.
Errors, corrections or late submissions are becoming more frequent.
Growth, an acquisition or a new pay frequency is on the horizon.

There are genuine reasons to stay in-house. A very large, highly specialised payroll with a strong established team; pay arrangements so bespoke that standardising them would cost more than it saves; or a strategic preference to keep the capability internal. If you're torn, a hybrid arrangement lets you keep your team while a provider adds capacity and cover.

We're always transparent that outsourcing isn't right for every organisation. The choice is yours to make. If you're still weighing it up, our payroll switching quiz gives you a quick read on where you stand, and our guide comparing in-house payroll with outsourcing sets out the full pros and cons with a worked cost comparison.

Once you've decided to outsource, the next step is choosing the right provider.

Choosing a managed payroll provider

Look for independent assurance: CIPP-qualified people, ISO 27001 and ISAE 3402.
UK legislative expertise and a clear service model matter more than feature lists.
Formalise the process with a structured request for proposal once you have a shortlist.

The provider you choose shapes everything that follows, from how smoothly you go live to how confident you feel on every payday. Payroll outsourcing companies vary widely in size, service model and specialism, so here are six things to look for.

Accreditation and assurance. CIPP-qualified payroll professionals, ISO 27001 for information security and an independently audited controls report such as ISAE 3402 Type II. What to ask: can you share your latest assurance report, and what does it cover?
UK legislative expertise. How the provider tracks, interprets and implements change. What to ask: how are you preparing clients for mandatory payrolling of benefits in kind?
Service model and support. Who you'll deal with day to day and how queries and escalations are handled. What to ask: will we have named contacts, and what service levels apply?
Implementation approach. A structured method, clear responsibilities on both sides and parallel running before go-live. What to ask: what will you need from us, and when?
Integration. How the provider connects to your HR, time and attendance and finance systems. What to ask: which of our systems have you integrated with before?
Fit and references. Customers of a similar size, sector and complexity to you. What to ask: can we speak to a customer with a payroll like ours?

Run the selection as a process, not a series of sales calls. Agree your requirements internally first, involving payroll, HR, finance, IT and whoever owns data protection. Build a longlist, narrow it to three or four, and ask each shortlisted provider for a demonstration using your own scenarios rather than a standard script. Take up references, and have your IT or security team review each provider's security documentation before you decide.

When you're ready to go to market, a structured request for proposal (RFP) makes quotes comparable and your requirements explicit. You can download our RFP template to get started.

For the full evaluation checklist, read our guide on how to choose a payroll provider, and for what to include in your tender, see our payroll RFP template guide.

Implementation and switching: what to expect

UK payroll implementations typically take three to five months, depending on complexity.
Parallel running proves the new payroll before you rely on it.
Clean data from your current system is the biggest single factor in a smooth move.

It's common to put off the move for fear of disruption. After all, you want to ensure your employees get paid accurately and on time. The good news? Moving payroll to a managed service is a well-trodden process, and an experienced provider has done it many times.

Most implementations follow the same phases:

Discovery: the provider maps your pay rules, pay groups, schedules, integrations and reporting needs.
Data preparation: employee records, year-to-date figures and pension data are extracted from your current system and cleansed.
Configuration: your payroll, interfaces and approval workflows are set up.
Testing and parallel running: one or more pay periods run in both the old and new systems, and differences are investigated until the results match.
Go-live: your first live payroll on the new service.
Early-life support: closer contact until the service settles into its routine.

UK payroll implementations typically run three to five months, depending on headcount, the number of payrolls and the integrations involved. Many organisations aim to go live at the start of a tax year, which avoids carrying over year-to-date figures, but a mid-year move is routine for an experienced provider.

What you'll need to provide

Expect to supply employee master data, year-to-date pay and tax figures, pension scheme details, pay rules and allowances, historic payroll reports for reconciliation, and a named person with authority to make decisions. You'll also need time from your own team to review parallel run results; this is where most of your effort goes.

In our experience, the most common cause of implementation overruns is incomplete data from the outgoing system. Start that conversation early, and agree who will extract what.

Don't forget your employees. Tell them before go-live what's changing: how they'll receive payslips, who to contact with questions and whether anything will look different on their payslip. A short, clear message avoids a spike in queries on the first payday.

Switching from one provider to another follows the same pattern, with the added step of managing your notice period and exit from the current contract. At larger scale, the same method still holds: ISS brought multiple payrolls covering more than 38,000 employees into a single, stable operation with us.

For step-by-step detail, read our guides on how to switch payroll provider and what to expect from payroll implementation.

Building the business case

The arguments that win approval are the cost of the status quo, risk and capacity.
Compare a provider's quote with the full cost of in-house payroll, not salaries alone.
Include the do-nothing option, properly costed.

If outsourcing looks right, someone still has to sign it off: usually a finance director or CFO, sometimes a board. They'll want a document that speaks their language, and three arguments tend to carry it.

The cost of the status quo. Cost your current operation in full: people, software, training, cover, error correction and penalties. The most common mistake is comparing a provider's quote with payroll salaries alone, which makes in-house look cheaper than it is.

Risk. Penalty exposure, key-person dependency and the legislative changes your current setup will need to absorb.

Capacity. Hours recovered by HR and finance, valued at their fully loaded cost, are more persuasive than "freeing up the team".

Timing matters too. Align your proposal with budget cycles, the renewal date on your current software or provider contract, and, if you can, a start-of-tax-year go-live. Working back from those dates tells your approver when a decision is needed and why.

Include the do-nothing option as a genuine costed alternative, not a strawman, and commit to the measures you'll report after go-live, such as accuracy, on-time submissions and query volumes. Our ROI calculator and other tools help with the numbers, and our guide to building a business case for payroll outsourcing walks you through every section of the document.

Whatever the business case says, one thing doesn't change when you outsource: your legal obligations.

UK compliance and managed payroll

You stay legally responsible for PAYE, National Insurance and pension duties, even when a provider runs payroll.
A provider helps most with RTI deadlines, auto-enrolment and the flow of legislative change.
Your contract should set out data protection roles and responsibilities clearly.

What you stay responsible for

Outsourcing moves the work, not the legal responsibility. HMRC holds you, the employer, responsible for PAYE even when a provider runs it. Your workplace pension duties sit with you too, and it's you that The Pensions Regulator will contact if something goes wrong.

The same applies to data. Under UK GDPR, you're typically the controller of your employees' personal data and your provider acts as your processor, which means you need a written contract setting out how they handle, secure and return that data. The ICO's guidance on contracts between controllers and processors explains what that contract must cover.

Where a provider helps most

RTI deadlines. Every pay run needs a Full Payment Submission (FPS) sent to HMRC on or before payday. Late filing penalties range from £100 to £400 a month depending on how many employees you have, and apply to each PAYE scheme you run.

Auto-enrolment. Assessing workers every pay period, enrolling eligible jobholders, processing opt-outs and contributions, and re-enrolling every three years. The Pensions Regulator sets out your duties as an employer.

Year-end. The final submission of the year, P60s for every employee and P11D reporting of benefits and expenses, which is moving into payroll in phases from April 2027.

National Minimum Wage. Underpayments often come from how pay is structured rather than the headline rate: salary sacrifice, deductions for uniforms, unpaid time such as training or travel between sites, and salaried workers whose hours creep up. A specialist provider can check pay against the minimum each period and flag workers who fall below it. The government can publicly name employers found to have underpaid, so this is a reputational risk as well as a financial one.

Records. You must keep payroll records for at least three years after the end of the tax year they relate to, and longer for some purposes, such as minimum wage records. A provider holds these securely, but make sure your contract covers how you get them back if you ever leave.

The legislative pipeline. The Employment Rights Act 2025 changed Statutory Sick Pay from April 2026, removing the waiting days and the lower earnings limit. Mandatory payrolling of benefits in kind starts on 6 April 2027 for company cars, vans, fuel and medical benefits, with most other benefits following from April 2028. Changes like these land on every payroll at once, and each one needs interpreting, building, testing and explaining to employees.

This is where specialist expertise pays for itself. Asda outsourced its payroll to us to help it stay ahead of payroll legislation. If you'd like to keep up with what's coming, our monthly Payroll Question Time webinar covers the latest changes.

Compliance is one reason payroll can't sit in isolation. The other is your HR data.

Managed payroll and HR integration

Payroll depends on HR data; integration means it's entered once.
You can combine payroll and HR on one platform, or connect managed payroll to the HR system you already use.
Ask how integration will work before you sign, not after.

Nearly every payroll input starts life in HR. Starters and leavers, pay changes, absence, family leave and bank details all originate there. When the two systems don't talk, data is keyed twice, and every re-key is a chance for an error that reaches someone's pay.

The same applies to time and attendance. If hours, overtime and shift premiums come from a workforce management system, a direct feed into payroll removes one of the most error-prone manual steps in the whole cycle.

Integration gives you a single source of truth. Changes flow from HR to payroll once, reporting draws on one set of data, and employees see consistent information whichever system they use.

There are two routes. You can run HR and payroll on one integrated platform, or keep your existing HR system (such as Workday, SAP SuccessFactors or Oracle) and connect it to your managed payroll. Both work; the right choice depends on how well your current HR system serves you and how much change you want to take on at once.

Whichever route you take, check whether integration is within the provider's scope and fee, which systems they've connected to before, and how data errors between systems are caught and resolved.

For more on the benefits of integrated HR and payroll software, and on choosing the HR side of the equation, see our HR software buyer's guide. You can also read about our payroll integrations.

Why SD Worx

We've been running payroll for 80 years. Today we serve more than 90,000 customers worldwide and process over six million payslips every month, with a UK payroll accuracy rate of 99.97%. Our payroll professionals are CIPP-certified, our technology is HMRC-recognised and GDPR-compliant, and we're certified to ISO 27001, ISAE 3000 and ISAE 3402 Type II.

We help shape payroll legislation, not just follow it. SD Worx representatives sit on UK Government consultation panels including the Rep Body Group and the Employer Payroll Group, and we're active in BCS (PSG), IReeN and the CIPP. Our UK Compliance Director, Simon Parsons, is a recognised authority on UK payroll legislation and fronts our annual Payroll Legislation Guide and monthly Payroll Question Time.

We grow with you. We run payroll in 26 European countries, with a partner network spanning more than 120, and we're recognised by analysts including Gartner, NelsonHall and Everest Group. We've been a Workday GPC partner since 2014 (PECI certified) and an SAP Gold Partner, and our managed payroll integrates with SAP and Oracle HCM systems.

We support you through the move. Our implementation teams provide hands-on support from payroll setup and data migration to testing, training and go-live, so you're not managing the transition alone. And we're always transparent that outsourcing payroll isn't right for every organisation.

Organisations of every size trust us with their payroll. Asda outsourced to stay ahead of legislation. ISS turned multiple payrolls for over 38,000 employees into one stable operation. Hertz has partnered with us for 40 years. Molson Coors streamlined its payroll operations with us, and as Melanie Salmon, HR Operations Manager, puts it:

"I love working alongside SD Worx... I know I can call any of the team with a concern, and they will be there to support me."

Our customers also include Aston Martin, Nissan and Waterstones, among many others. You can explore our customer stories, find out more about our payroll outsourcing services, or, if you run a smaller team, see our payroll for small businesses.

Frequently asked questions

What is managed payroll?

Managed payroll is an arrangement where a specialist provider runs your payroll on your behalf: calculating pay and deductions, submitting to HMRC, producing payslips and pension files, and keeping the system up to date with legislation. You supply the pay data each period and approve the payroll before payments are made. It's also known as outsourced payroll or payroll outsourcing.

What's the difference between managed payroll and a payroll bureau?

The terms are used inconsistently across the market. Typically, a payroll bureau processes the data you send and leaves more of the data entry, checking and administration with you, while a fully managed service takes on more of the process, including checks, exception handling and often employee queries. The reliable way to compare is to ask each provider exactly which tasks they do and which stay with you.

How much does managed payroll cost in the UK?

Most providers charge per employee per month, typically around £4 to £15, with fully managed services commonly between about £5 and £12. There's usually a separate one-off implementation fee. Your price depends on headcount, pay frequencies, complexity and integrations. Our payroll outsourcing costs guide covers pricing in detail.

Is outsourcing payroll worth it?

For many employers, yes: once you count the full cost of in-house payroll, including software, training, cover and error correction, outsourcing often costs less, typically above around 20 to 30 employees. It also reduces key-person risk and brings specialist compliance expertise. It isn't right for everyone, though; very large or highly specialised payrolls with a strong in-house team may be better kept internal.

What's included in a managed payroll service?

A managed payroll service usually includes gross-to-net calculations, statutory payments, RTI submissions to HMRC, payslips, pension contribution files, year-end outputs such as P60s, and system updates for legislative changes. Many providers also handle employee pay queries, payment files and reporting. Scope varies, so ask for the full list of what's included in the core fee.

How long does it take to implement managed payroll?

UK payroll implementations typically take three to five months, depending on headcount, the number of payrolls and the integrations involved. The process usually includes discovery, data migration, configuration, testing and at least one parallel run before go-live. Clean, complete data from your current system is the biggest factor in keeping to plan.

Can I outsource payroll and keep control?

Yes. With managed payroll you still own the inputs, approve every payroll before payments are released and make all pay decisions. Good providers also give you reporting and system access so you can see exactly what has been processed and submitted. What changes is who does the processing, not who is in charge.

What should I look for in a managed payroll provider?

Look for CIPP-qualified payroll professionals, ISO 27001 and an independently audited controls report such as ISAE 3402 Type II. Beyond that, assess UK legislative expertise, the service model and support, the implementation approach, integration with your systems and references from similar customers. Our guide on how to choose a payroll provider includes a full evaluation checklist.

Is managed payroll suitable for small businesses?

Yes. Many providers offer managed payroll to small employers, sometimes on a fixed monthly fee for very small teams. Small businesses often gain the most from specialist compliance support, because they rarely have payroll expertise in-house. Our guide to payroll services for small businesses compares the options.

What happens to my payroll team if I outsource?

It depends on the model you choose. Under a hybrid or bureau model, your team often keeps data entry and checking; under a fully managed model, roles usually shift towards oversight, inputs and employee queries. If a team's main purpose is payroll processing, TUPE may apply, which means you must inform and possibly consult affected employees. ACAS has guidance on TUPE, and it's worth taking legal advice early.

See what managed payroll would cost for your organisation

Get an instant estimate with our payroll outsourcing cost calculator, or contact our team to talk through your payroll.

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Managed Payroll Services: The Complete UK Guide

At a glance

What is managed payroll?

What moves to the provider, and what stays with you

How it differs from payroll software, a bureau and your accountant

Managed payroll services, bureaus and hybrid models

Which model suits you?

What managed payroll changes for your organisation

Costs and pricing

Costs beyond the headline rate: what to ask about

In-house or outsourced: how to decide

Signs it's time to look at outsourcing

Choosing a managed payroll provider

Implementation and switching: what to expect

What you'll need to provide

Building the business case

UK compliance and managed payroll

What you stay responsible for

Where a provider helps most

Managed payroll and HR integration

Why SD Worx

Frequently asked questions

What is managed payroll?

What's the difference between managed payroll and a payroll bureau?

How much does managed payroll cost in the UK?

Is outsourcing payroll worth it?

What's included in a managed payroll service?

How long does it take to implement managed payroll?

Can I outsource payroll and keep control?

What should I look for in a managed payroll provider?

Is managed payroll suitable for small businesses?

What happens to my payroll team if I outsource?

See what managed payroll would cost for your organisation

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