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Head-to-head · Small Business Payroll Software

Xero Payroll vs Gusto

  • Updated Oct 2026
  • Both researched from official sources
  • 4 checks side by side
Higher score Xero Payroll #3 in Small Business Payroll Software 9.0/10 30-day trial Free trial✓ 3 of 3 features Visit Xero
Gusto #5 in Small Business Payroll Software 8.8/10 Paid ✓ 0 of 3 features Visit Gusto

Xero Payroll leads on 0 checks, Gusto on 0, and 4 are even. Who comes out ahead on the 4 yes/no, price and count checks where we have data for both products. The editor score weighs everything else too.

Our verdict

  • Highest scoreXero Payroll · 9.0/10
  • Free trialonly Xero Payroll
  • Most featuresXero Payroll · 3 of 3

Xero Payroll scores higher on our rubric for small business payroll software: 9.0 against 8.8 out of 10; our editors rank them #3 and #5.

Xero Payroll is the better fit for UK businesses needing detailed HMRC payroll support. Gusto is the better fit for small businesses pairing payroll with HR and benefits.

  • Xero Payroll fits best

    UK businesses needing detailed HMRC payroll support

  • Gusto fits best

    Small businesses pairing payroll with HR and benefits

Advertiser disclosure: iTechGuides is reader-supported. Vendors can pay for top positions in our rankings and for a place on other products' pages, and we may earn a commission when you click some links. How we rank.

Side by side

Feature Xero Payroll 9.0/10 Visit ↗ Gusto 8.8/10 Visit ↗
At a glance
Editor score 9.0 8.8
Ranking #3 in Small Business Payroll Software #5 in Small Business Payroll Software
Best for UK businesses needing detailed HMRC payroll support Small businesses pairing payroll with HR and benefits
Pricing model Paid Paid
Starting price £39/mo —
Free plan — —
Free trial 30 days —
Deployment Cloud, Mobile Cloud, Mobile
Platforms Web, iOS, Android Web, iOS, Android
Support Docs, Community · 24/7 Email, Live chat, Phone, Docs · 24/7
Compliance GDPR SOC 2, HIPAA, 2FA
Integrations 1,000+ integrations 8 integrations
Built for Small business, Mid-market Small business, Mid-market
Features Xero Payroll 3/3 · Gusto 0/3
Tax filing included ✓ (best) Not checked yet
Direct deposit ✓ (best) Not checked yet
Employee self-service ✓ (best) Not checked yet
Specs
Pay frequencies weekly, fortnightly, four-weekly, monthly, quarterly, annually Not checked yet
Worker pay types employees, directors, off-payroll workers (IR35) Not checked yet
Payroll runs Unclear Not checked yet
Our review
Pros
  • Files Full Payment Submissions and Employer Payment Summaries to HMRC
  • Calculates PAYE, NIC, pensions and leave automatically
  • Supports employees, directors and off-payroll workers
  • Processes payroll and tax filings, with single- and multi-state options
  • Combines onboarding, PTO, time tracking, benefits, and employee records
  • Connects with QuickBooks Online, Xero, Slack, and Google Workspace
Cons
  • Ignite payroll costs £1.50 per person per month on top of accounting
  • Grow, Comprehensive and Ultimate plans cost £39, £55 and £70 monthly
  • Support channels listed are documentation and community
  • No free plan is offered
  • The Contractor Only plan is limited to domestic contractor payments
  • Core payroll options differ by plan, including single- versus multi-state coverage
Our verdict

Xero Payroll is cloud payroll software for UK small businesses that need to calculate pay and meet payroll reporting requirements. It suits businesses with employee, director or off-payroll worker payroll, particularly those that also want…

Read the review →

Gusto brings payroll, tax filings, benefits, and HR workflows into a cloud platform for small businesses. Employers can manage employee records, onboarding checklists, e-signatures, PTO, time tracking, and performance reviews, while…

Read the review →
  1. Xero PayrollSmall Business Payroll Software 9.030-day trial
  2. GustoSmall Business Payroll Software 8.8Paid

Strengths and trade-offs

  • Xero Payroll — where it wins

    • Files Full Payment Submissions and Employer Payment Summaries to HMRC
    • Calculates PAYE, NIC, pensions and leave automatically
    • Supports employees, directors and off-payroll workers

    Where it doesn't

    • Ignite payroll costs £1.50 per person per month on top of accounting
    • Grow, Comprehensive and Ultimate plans cost £39, £55 and £70 monthly
    • Support channels listed are documentation and community

  • Gusto — where it wins

    • Processes payroll and tax filings, with single- and multi-state options
    • Combines onboarding, PTO, time tracking, benefits, and employee records
    • Connects with QuickBooks Online, Xero, Slack, and Google Workspace

    Where it doesn't

    • No free plan is offered
    • The Contractor Only plan is limited to domestic contractor payments
    • Core payroll options differ by plan, including single- versus multi-state coverage
  • Xero Payroll9.0/10 · 30-day trial

    A UK-focused payroll option with pension reporting, multiple pay schedules and Xero accounting plans.

    Visit XeroFull verdict →
  • Gusto8.8/10 · Paid

    Payroll with HR, benefits, onboarding, and time tracking in one cloud platform.

    Visit GustoFull verdict →

More comparisons

All small business payroll software comparisons → · Full ranking →

Reviewed by iTechGuides Editors · Editorial team · Updated Oct 2026

Last updated · How we research and update