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Pay, Payroll & Working Time

What is a Payroll service?

Updated 20 Jan 2026 5 min read

A payroll service is a solution that handles some or all aspects of employee pay processing, including wage calculations, tax withholding, superannuation, and compliance reporting. In Australia, payroll services range from software platforms (like Xero, MYOB) to full-service providers that manage payroll on behalf of businesses.

Types of payroll services

Australian businesses have several options for managing payroll, from handling it entirely in-house with software to fully outsourcing to a bureau service.

Payroll software

  • Self-managed with software
  • Xero, MYOB, QuickBooks
  • Lower cost, more control
  • Requires payroll knowledge

Bureau/outsourced

  • Fully managed by provider
  • Professional expertise
  • Higher cost, less effort
  • Good for complex situations

Key features of payroll services

When evaluating payroll services for Australian businesses, look for these essential features:

Essential payroll service features

STP compliance: Single Touch Payroll reporting
Super management: Calculate and pay super
PAYG calculations: Current ATO tax tables
Payslip generation: Fair Work compliant payslips
Leave management: Track accruals and balances
Integrations: Connect with time and accounting

Payroll service integration

For businesses with shift-based workers, integrating payroll services with time and attendance systems is crucial for accuracy and efficiency.

Integration benefits

Integrating time tracking with payroll eliminates manual data entry—a common source of errors. When hours flow automatically from timesheets to payroll, with award rates already applied, you reduce underpayment risk and save processing time. Look for payroll services that integrate with your workforce management tools.

Choosing a payroll service

Consider software if you:

  • Have straightforward payroll needs
  • Want to manage payroll in-house
  • Have payroll knowledge or training
  • Prefer lower ongoing costs

Consider outsourcing if you:

  • Have complex awards or agreements
  • Lack payroll expertise internally
  • Want to reduce compliance risk
  • Prefer hands-off payroll management

Common payroll service mistakes

Choosing on price alone

The cheapest service may lack features you need, leading to compliance issues or manual workarounds that cost more in time.

Ignoring integration capabilities

A payroll service that doesn't integrate with your time tracking means manual data entry and increased error risk.

Assuming outsourcing removes responsibility

Even with a bureau service, the employer remains legally responsible for compliance. Verify the service is doing things correctly.

Key takeaways

Payroll services range from software you manage yourself to full-service providers who handle everything. Choose based on your business complexity, internal expertise, and integration needs. All Australian payroll services must support Single Touch Payroll reporting.

RosterElf integrates with major Australian payroll services including Xero, MYOB, automatically exporting approved timesheets with correct award rates applied. This integration reduces manual entry and ensures accurate pay calculations.

Frequently asked questions

Steve Harris

Written by

Steve Harris

Steve Harris has spent over a decade advising businesses in hospitality, retail, healthcare, and other fast-paced industries on how to hire, manage, and retain great staff. At RosterElf, he focuses on sharing actionable advice for business owners and managers — covering everything from smarter interview techniques and compliance with Australian employment laws, to building positive workplace cultures.

General information only – not legal advice

This glossary article about payroll service provides general information about Australian employment law and workplace practices. It does not constitute legal, HR, or professional advice and should not be relied on as a substitute for advice specific to your business, workforce, or circumstances.

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