The global HR platform for small businesses

Small business payroll software helps firms that don’t have the resources of large corporations to run payroll for staff in multiple locations. While many organisations still operate locally, the rise of remote work means businesses of all sizes can work with people in different cities and countries. Whether a small business needs payroll for just a few team members or for a fully distributed team, payroll software must flex to the company’s needs.

For a small business, payroll software may cover the basics, such as paying team members on time and in the right amounts. For international teams, the platform also needs to ensure staff are paid in the correct currencies and, where required, through approved banks. More feature-rich payroll platforms like Remote include extra services, such as benefits administration and globally compliant employee stock option plans.

In most cases, small businesses can’t run payroll in-house for global teams. To pay team members in other countries legally, small businesses have three options: set up an entity in each country where employees are based, work with an employer of record, or engage workers as contractors.

While some businesses choose to hire everyone as contractors, that approach can create complex compliance problems. Misclassifying international contractors is a serious risk that could cost a small business thousands of dollars and significant time. Hiring contractors overseas can work well, but only when you’re dealing with genuine contractors and using an international contractor management platform.

Some small businesses do open one or two entities in countries where they have a concentration of employees and a solid presence. But few choose to establish entities everywhere they hire, as that approach is costly and can take months to complete.

Working with an employer of record is often the fastest, simplest way for small businesses to run payroll for global teams. An EOR lets a small business hire employees legally in other countries. A global employment platform like Remote manages payroll and taxes, administers benefits to meet local obligations, and handles all issues of compliance.

Small businesses outsource HR because it’s generally more cost-effective than building every HR function in-house. The resources needed to run payroll, manage benefits, withhold taxes, make statutory deductions, operate employee stock option plans and stay abreast of changing regulations are simply too large for most small teams. Even many large organisations outsource these functions to specialists.

For small businesses hiring internationally, HR challenges increase. Remote’s guide to international payroll processing outlines common challenges and offers practical tips to navigate them.

Outsourcing payroll helps small businesses reduce costs while delivering a better experience for employees. Even large organisations often face payroll and benefits issues when relying on in-house systems.

In a small business, every employee matters, so mismanagement of payroll can quickly damage the employee–employer relationship.

Outsourcing payroll saves time on administration and greatly reduces payroll errors. Employees expect on-time, accurate and consistent pay as a basic part of the working relationship.

For a small business with limited resources, achieving error-free payroll in-house is tough. With an outsourced payroll provider, even the smallest teams can access enterprise-grade reliability.

Startups face different expectations and pressures compared with small businesses. Startup growth can be sudden and unpredictable, with rapid pivots. Small businesses also grow, but typically in a less chaotic way for more established operations.

Both startups and small businesses need payroll solutions that are reliable and flexible. Small businesses often lack the investor backing startups enjoy, so their costs usually have to be covered by product and service sales rather than investor cash. That makes it vital to avoid payroll vendors with hidden fees or unpredictable charges.

It’s important for small businesses to ask the right questions about payroll at the start of any relationship with a payroll provider.

Costs for small business payroll services vary depending on where employees live, total company payroll and the benefits you choose to offer. Generally, simple local payroll services don’t require high fees.

Small businesses with remote teams across multiple countries do incur higher payroll costs, but those fees typically cover benefits administration, foreign tax withholding and compliance with local employment laws.

When the choice is between hiring the right person overseas or continuing a local search, onboarding an employee in another country can deliver significant savings over time. For more information on costs for small business payroll across multiple countries, see Remote’s pricing page.

EORs (employers of record) used to be services mainly for large enterprises, but that’s changed. Remote work has driven EOR pricing down, making international talent more accessible to small businesses without excessive fees or salary mark-ups.

Any small business looking to use an EOR to onboard international talent should ask the following questions of potential EOR providers:

• Is this an owned-entity EOR in every country, or does this EOR outsource its services to third parties in certain countries?

• What protections does the EOR offer for intellectual property and invention rights?

• How securely does the EOR handle your employees’ sensitive personal information?

• If you offer an employee stock purchase plan, can the EOR manage that plan for you, including tax withholding?

• Do you need separate platforms for contractors and employees?

• Are there any hidden fees that vary by country?

• Does the EOR offer discounts for startups or social-purpose organisations?