Managing payroll in the fast-paced and dynamic environment of the restaurants and hotels industry presents a unique set of challenges. From handling tips and gratuities to managing part-time and seasonal workers, hospitality business owners and managers require robust payroll solutions that can cater to their specific needs. Fortunately, there are several payroll software and services designed to ease this burden, offering features like automated tax filings, time tracking, and compliance management.
This article compares the top 8 payroll solutions for restaurants and hotels in the UK, helping you choose the best option for your hospitality business.
Best hospitality payroll systems – software and services for hotels and restaurants
| Feature | Sage Payroll | QuickBooks Payroll | Xero Payroll | PayFit | ADP Payroll | Cintra | BrightPay | Zellis |
|---|---|---|---|---|---|---|---|---|
| Ease of Use | High | Very High | High | Very High | Moderate | Moderate | High | Moderate |
| Tax & Compliance | Comprehensive | Comprehensive | Comprehensive | Comprehensive | Comprehensive | Comprehensive | Comprehensive | Comprehensive |
| Tips Management | Basic | Advanced | Basic | Advanced | Advanced | Basic | Advanced | Advanced |
| Integration Options | Moderate | High | High | High | High | High | Moderate | High |
| Real-Time Information | Yes | Yes | Yes | Yes | Yes | Yes | Yes | Yes |
| Automatic Enrolment | Yes | Yes | Yes | Yes | Yes | Yes | Yes | Yes |
| Employee Self-Service | Limited | Yes | Yes | Yes | Yes | Yes | Yes | Yes |
| Customer Support | Excellent | Excellent | Good | Excellent | Excellent | Excellent | Excellent | Excellent |
| Pricing | Custom | Tiered | Tiered | Tiered | Custom | Custom | Tiered | Custom |
| Mobile App | No | Yes | Yes | Yes | Yes | No | No | Yes |
1. Sage Payroll
Sage Payroll is a comprehensive solution known for its reliability and extensive support services. It offers features tailored to the UK market, such as real-time information (RTI) submissions to HMRC and automatic enrolment for pensions.
Its user-friendly interface and detailed reporting capabilities make it a favoured option among restaurant owners.
- Takes 2 minutes
- Receive quotes to compare
- Easy and no commitment
Pricing
| Number of Employees | Monthly Price (£) |
|---|---|
| 1-5 | £8.00 |
| 6-10 | £13.00 |
| 11-15 | £19.00 |
| 16-25 | £29.00 |
| 26-35 | £39.00 |
| 36-50 | £55.00 |
| 51-75 | £80.00 |
| 76-100 | £106.00 |
Further information
Read our Sage Payroll review or visit the website.
2. QuickBooks Payroll
QuickBooks Payroll is ideal for small to medium-sized restaurants and hotels looking for an integrated accounting and payroll solution.
It automates tax calculations, payslips, and filings directly to HMRC, and offers a mobile app for on-the-go management. Its ability to handle tips and additional restaurant-specific payroll complexities makes it a strong contender.
Pricing
QuickBooks Payroll is available as an add-on for all plans except the basic Self-Employed option. The payroll feature starts “From £2 per month”, though QuickBooks has not publicly disclosed the detailed pricing structure for this service.
- Give your requirements
- Receive quotes to compare
- Choose a provider or walk away - your choice!
Further information
Read our QuickBooks Payroll review or visit the website.
3. Xero Payroll
Xero‘s payroll software seamlessly integrates with its accounting services, offering a unified solution for restaurant or hotel finances.
Features include automatic tax calculations, pension submissions, and an employee portal for payslips and time-off requests.
Xero is particularly appreciated for its straightforward interface and cloud-based access.
Pricing
| Plan | Standard Monthly Cost | Discounted Cost (First 6 Months) | Included Payroll | Cost After Free Period | Additional Employee Cost |
|---|---|---|---|---|---|
| Starter | £15 | £7.50 | 2 Months Free | £5/month for up to 5 | £1/month |
| Standard | £30 | £15 | 2 Months Free | £5/month for up to 5 | £1/month |
| Premium | £42 | £21 | 2 Months Free | £5/month for up to 5 | £1/month |
| Ultimate | £55 | £27.50 | Up to 10 Included | £1/month per extra | £1/month |
Further information
Read our Xero Payroll review or visit the website.
4. PayFit
PayFit stands out as a modern and intuitive payroll solution designed for the UK market, especially catering to the needs of small to medium-sized restaurants.
It simplifies payroll processing with features like automatic tax and NI contributions, real-time HMRC submissions, and an integrated employee portal for accessing payslips and submitting time-off requests.
PayFit’s emphasis on automation and user experience makes it particularly attractive for restaurants or hotels looking to streamline their payroll operations without requiring extensive payroll knowledge.
Pricing
| Feature/Cost | Light | Standard | Premium |
|---|---|---|---|
| Starting Monthly Cost | From £25* | From £75* | From £135* |
| Cost per Employee | £6 | £6 | £6 |
| Base Fee | £19 | £69 | £129 |
| Cancellation Policy | You can cancel anytime | You can cancel anytime | You can cancel anytime |
| Core Payroll | ✓ | ✓ | ✓ |
| Bank File | ✓ | ✓ | ✓ |
| Supported Onboarding & Video Training | ✓ | ✓ | ✓ |
| RTI Submissions | ✓ | ✓ | ✓ |
| Standard Pensions | ✓ | ✓ | ✓ |
| Help Centre Access | ✓ | ✓ | ✓ |
| HR Features | ✓ | ✓ | |
| Expenses | ✓ | ✓ | |
| 1-2-1 & Performance Review Modules | ✓ | ✓ | |
| Automated P11Ds | ✓ | ✓ | |
| Access to CIPP Payroll Experts | ✓ | ✓ | |
| Non-standard Pensions | ✓ | ||
| Custom Payroll Journals | ✓ | ||
| Managed P11Ds | ✓ | ||
| Optional Faster Payments | £1/employee/month | £1/employee/month | £1/employee/month |
* From price does not include the base fee or per-employee cost.
Further information
Read our PayFit review or visit the website.
5. ADP Payroll
ADP offers scalable payroll solutions that can grow with your restaurant or hotel. It provides comprehensive services including payroll processing, tax filing, and HR management. ADP’s strong suit is its customisability and extensive reporting features, making it suitable for larger restaurants or chains that require a tailored approach.
Pricing
Offers tailored plans and pay-as-you-go one-off payroll processing options. See our guide to ADP payroll prices.
Further information
Read our ADP Payroll review or visit the website.
6. Cintra
Cintra is recognised for its tailored payroll and HR solutions that cater to a wide range of business sizes, including restaurants.
Its strength lies in its comprehensive service offering, which includes customisable payroll processing, detailed reporting, and integrated HR and pension management.
Cintra’s flexibility and dedication to customer service make it a suitable choice for restaurants that seek a personalised approach to payroll, ensuring that both standard and complex payroll requirements are efficiently managed.
Pricing
| Employee Headcount | 36 months (£) | 48 months (£) | 60 months (£) |
|---|---|---|---|
| 51-100 | 5.50 | 4.95 | 4.68 |
| 101-200 | 4.18 | 3.76 | 3.55 |
| 201-500 | 3.91 | 3.52 | 3.32 |
| 501-1000 | 3.52 | 3.17 | 2.99 |
| 1001-2000 | 3.25 | 2.93 | 2.76 |
| 2001+ | 2.86 | 2.57 | 2.43 |
Further information
Read our Cintra Payroll review or visit the website.
7. BrightPay
BrightPay is a popular choice among UK businesses for its flexibility and comprehensive features, including payroll processing, automatic enrolment, and a free employee app.
It’s particularly lauded for its customer support and the ability to manage multiple pay schedules, making it suitable for restaurants or hotels with varied staffing needs.
Pricing
| Number of Employees | Cost Per Tax Year (£) |
|---|---|
| Up to 3 | 79 |
| Up to 10 | 139 |
| Up to 25 | 209 |
| Unlimited | 289 |
Note: All prices are per tax year and exclude VAT.
Further information
Read our BrightPay review or visit the website.
8. Zellis
Zellis is a heavyweight in the UK payroll services market, offering bespoke solutions for large restaurants and chains.
Its strengths lie in its advanced analytics, custom reporting, and dedicated support for complex payroll requirements.
Zellis is best suited for establishments that require a high degree of customisation and detail in their payroll processes.
Pricing
| Feature/Package | Small Business (up to 50 employees) | Medium Business (51-200 employees) | Large Business (201+ employees) |
|---|---|---|---|
| Basic Payroll Subscription | £50/month | £100/month | £200/month |
| Real-time Reporting Add-on | £10-£20/month | £20-£40/month | £40-£80/month |
| Employee Self-service Portal | £25-£50/month | £50-£100/month | £100-£200/month |
| Premium Support | £20-£40/month | £40-£80/month | £80-£160/month |
| Basic HCM Cloud | £200/month | £400-£600/month | £800-£1,200/month |
| Customised HCM Modules | £50-£100/month | £100-£200/month | £200-£400/month |
Further information
Read our Zellis Payroll review or visit the website.
The unique challenges of hospitality payroll
Hospitality payroll management involves navigating a complex landscape of regulations and variable factors that distinguish it significantly from other industries. These challenges are multifaceted, arising from the nature of employment, the structure of pay, and compliance requirements specific to the hospitality sector.
Variable work hours and seasonal employment
Hospitality businesses often employ a mix of full-time, part-time, and seasonal workers, with schedules that vary widely from week to week. Managing payroll for such a diverse workforce requires flexibility and precision to ensure accurate pay for hours worked, including overtime and holiday pay, which can fluctuate significantly.
Tips and service charges
Handling tips and service charges is perhaps one of the most unique aspects of hospitality payroll. These payments must be processed in a way that complies with tax regulations and fairness in distribution. The method of collecting and distributing tips – whether through a tronc system or direct allocation – adds another layer of complexity to payroll calculations.
Tax and compliance issues
Restaurants and hotels must adhere to a strict regulatory framework, including tax withholdings, National Insurance contributions, and reporting requirements. The sector is also subject to frequent inspections and audits, making compliance a critical aspect of payroll management. This includes the accurate reporting of tips and other gratuities, which are scrutinised under tax laws.
Employment rights and benefits
The hospitality industry, including restaurants and hotels, must manage payroll in line with employment rights and benefits, such as pensions, sick pay, and maternity or paternity leave. Balancing these legal obligations with the informal nature of some restaurant employment can be challenging.
High turnover rates
Restaurants and hotels often experience higher turnover rates than many other industries, leading to frequent onboarding and offboarding. This dynamic environment requires payroll systems that can efficiently handle the constant changes in employee status, ensuring that final payments are accurate and compliance issues are addressed.
Integration with other systems
Effective restaurant payroll management often requires integration with other systems, such as time and attendance tracking and accounting software. Ensuring seamless data flow between these systems can be a technical challenge but is essential for accurate and efficient payroll processing.
These unique challenges highlight the need for specialised payroll solutions that can address the specific requirements of the hospitality industry. Choosing the right software or service, as discussed earlier, can help restaurant owners and managers navigate these complexities, ensuring compliance and employee satisfaction.
FAQ – Payroll and hospitality management
The best payroll software for a small restaurant typically offers features like easy tax compliance, tip management, and scalability. Solutions like QuickBooks Payroll and PayFit are popular choices for their user-friendly interfaces and comprehensive services tailored to small businesses.
Restaurants can manage payroll for employees with varying shifts by using payroll software that integrates with time and attendance systems, ensuring accurate tracking of hours worked and automatic calculation of pay, including overtime.
Yes, certain payroll systems are designed to handle restaurant tips and gratuities efficiently, allowing for the distribution of tips through payroll and ensuring compliance with tax regulations.
Legal requirements for restaurant payroll documentation in the UK include keeping records of all wages and deductions, reporting to HMRC through Real Time Information (RTI), and providing employees with payslips.
Payroll software helps restaurants comply with minimum wage laws by automatically updating to reflect current rates and adjusting employees’ pay accordingly, ensuring legal compliance.
Yes, many restaurant payroll software solutions offer integration capabilities with other business systems such as accounting software, POS systems, and time tracking tools, providing a more streamlined and efficient operational workflow.
A restaurant should look for payroll software with features like flexible employee classification, easy onboarding and offboarding, and the ability to handle variable hours and pay rates for seasonal employees.
Restaurants can ensure payroll confidentiality and security by choosing payroll software with robust encryption, access controls, and compliance with data protection regulations.
Payroll errors can negatively impact a restaurant’s reputation and employee morale by causing trust issues and financial stress for employees, underscoring the importance of accurate and reliable payroll processing.
Restaurants handle payroll for employees receiving tips directly by implementing policies for declaring tips, using payroll software that can account for these amounts in tax calculations and reporting.
Common challenges include managing variable employee hours, distributing tips accurately, complying with tax regulations, and integrating payroll data with other systems.
The frequency of payroll processing in a restaurant can vary, often determined by local laws and operational preferences, with most opting for bi-weekly or monthly pay periods.
Yes, many payroll software solutions offer features to manage employee benefits such as pension contributions, sick leave, and holiday pay, ensuring compliance and simplifying administration.
Penalties can include fines, back payments with interest, and legal actions, making it crucial for restaurants to maintain accurate records and comply with all payroll regulations.
Changes in legislation can affect tax rates, minimum wage levels, and employment rights, requiring restaurants to update their payroll processes and software to remain compliant.
Restaurants should look for a payroll service provider that offers comprehensive support, including training, customer service, and assistance with compliance issues.
Payroll software can accommodate pooled tips by allowing for the distribution of tip income based on customisable rules, ensuring fair and transparent sharing among staff.
Outsourcing restaurant payroll processing can offer advantages such as expert compliance management, time savings, reduced risk of errors, and access to advanced payroll technology.
Restaurants can reduce payroll processing costs by automating processes with software, reducing errors and administrative time, and potentially outsourcing to a cost-effective provider.
Future trends include increased automation, integration of AI for predictive scheduling and cost management, and enhanced employee self-service options for managing pay and benefits.