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Updated 21 October 2026
PAYROLL OUTSOURCING INDIA

Payroll Outsourcing in India that runs itself, accurately, on time, every time.

Payroll outsourcing services for small businesses and startups in India. From salary processing to TDS filing, we manage your entire payroll cycle with zero errors and full statutory compliance.

HRTailor mascot with calculator and payslip
100%
Filing accuracy
Zero
Late filings
15+
Years group HR experience
₹10,000
Starting per month
DEFINITION

What is payroll outsourcing?

Payroll outsourcing is when a business hands its entire monthly payroll to an external specialist. That covers salary calculation from attendance to net pay, statutory compliance across PF, ESIC, Professional Tax, TDS and LWF, payslip issuance and year end filings. Instead of hiring a payroll executive at ₹25,000 to ₹50,000 a month plus software, you pay one fixed monthly fee and a dedicated team runs it all on time. Some call this managed payroll: a payroll service provider runs the whole cycle while your employees stay on your books.

For a startup or SME with 5 to 100 employees in India, outsourcing payroll usually costs far less than running it in house, and it takes the penalty risk off the table. A single late PF return alone attracts 12% a year in interest, plus damages of up to 100% of the arrears.

THE MONTHLY CYCLE

How payroll works in India

Running payroll in India is not just paying salaries. It is a monthly compliance cycle set by central and state law. Here is the full run we handle for you, every single cycle.

  1. Collect inputs. Attendance, leave, new joiners, exits and variable pay come in by your cut off date.
  2. Compute gross to net. Earnings, deductions and reimbursements are worked out against each employee’s CTC.
  3. Apply statutory deductions. Provident Fund, ESIC, Professional Tax and TDS on salary, each under the right rule.
  4. Quality check. A three layer QC compares this run against the last one and flags anything odd before payout.
  5. Approve and pay. You approve a clean summary and salaries go out on your chosen date.
  6. File returns. PF, ESIC, PT, TDS and LWF are filed before their due dates, with challans generated.
  7. Report and record. Payslips go out, MIS is shared, and statutory registers stay audit ready.

Miss one step and the cost is real. A single late PF return attracts 12% a year in interest, plus damages of up to 100% of the arrears. Outsourcing payroll takes that risk off your desk.

WHAT WE DELIVER

End-to-end payroll, fully handled

Six core payroll functions, computed, filed and delivered every month without you lifting a finger.

01

Salary Computation

Gross-to-net calculations including HRA, LTA, reimbursements, and variable pay components. Every component verified against your CTC structure before processing.

02

PF & ESIC Filing

Monthly ECR generation, contribution filing, and new employee registration management. UAN activation, transfer claims and withdrawal processing handled end-to-end.

03

TDS & Form 130

TDS returns (Form 138 quarterly, formerly Form 24Q), monthly TDS working, and Form 130 (formerly Form 16) issuance for every employee. Investment declarations (Form 12BB) processed, tax-saving proof verification and revised computation on demand.

04

Professional Tax

State specific Professional Tax deductions, plus monthly or annual filing across every state where you operate. We track slab changes automatically, so nothing slips when a state government revises its rates.

05

Payslip Generation

Branded, itemised payslips delivered to employees on processing day via email or ESS portal. Components broken down clearly so employees understand their take-home.

06

Full & Final Settlement

Full and final settlement (F&F) calculation, gratuity, leave encashment, and clearance documentation handled end-to-end. Processed within 3 business days of confirmed last working day.

WHAT YOU GET

What lands in your inbox every month

Payroll outsourcing for a small business should leave you with proof, not just a salary credit. Every cycle you get:

  • Payslips and salary register. Payslips by email or the employee portal, plus the salary register and bank transfer file for your approval.
  • Statutory challans with payment proof. PF ECR and challan, ESIC, Professional Tax and Labour Welfare Fund, state by state.
  • TDS and tax forms. Monthly TDS, quarterly Form 138 returns and annual Form 130 for every employee.
  • Full and final statements. For every exit: notice pay, leave encashment, gratuity where due and final tax.
  • MIS report. Headcount, payroll cost and month-on-month changes, ready for your accountant.
  • Answers for your team. Payslip, tax declaration and PF or UAN questions handled by your payroll contact, not by you.
OUTSOURCE OR DO IT YOURSELF

Outsource payroll, or run it in-house?

Running payroll in house means chasing attendance, computing PF, ESIC, PT and TDS, generating payslips and filing returns, every single month. HRTailor's payroll pod does all of it for you, accurately and on time.

CriteriaIn-house payrollHRTailor
Monthly effort3 to 5 days of your team's time✓ Zero, we handle it all
AccuracyManual errors risk penalties✓ Three-layer QC process
ComplianceYou track deadlines yourself✓ Auto-filed before due dates
Cost₹25,000 to ₹50,000 a month (executive plus software)✓ From ₹10,000/month
ScalabilityBreaks at 50+ employees✓ Scales to any headcount
Error correctionYour liability✓ Corrected at no extra cost
SERVICE OR SOFTWARE

Payroll service or payroll software: which does a small business need?

Payroll software does the maths. A payroll service does the maths, the filings and the follow-up when rules change. The right choice depends on who you have in-house.

QuestionPayroll softwarePayroll outsourcing (HRTailor)
Who enters and checks inputs?You or your HR person✓ You approve, we validate
Who applies rule changes?The software updates rates, you apply them✓ We apply them to your salary structure
Who files PF, ESIC, PT and TDS?You✓ We do, with payment proof
Who answers employee questions?You✓ Your payroll contact
Best forTeams with an in-house payroll expert who has time every month✓ Founders and lean teams who want payroll off their plate

Already on payroll or HRMS software? We can run payroll on your existing system, so your team keeps the tool it knows.

HOW IT WORKS

Simple to start, built to scale

01

Data handover

You share attendance, leave, and variable pay inputs by your cut-off date. We take it from there.

02

Processing & QC

Payroll is computed, cross-checked, and validated against the previous cycle by our payroll team.

03

Approval & transfer

You review a clear payroll summary and approve. Salaries are transferred on your chosen date.

04

Statutory filing

Every filing under PF, ESIC, TDS, Professional Tax, Labour Welfare Fund, gratuity, bonus, maternity benefit and Shops and Establishments rules, now under the four Labour Codes, generated and filed before its due date. UAN activation and ESIC IIP registration for new joiners are included.

SWITCHING PAYROLL

Switching from another provider or spreadsheet?

Payroll Switch Checklist

A 21-day plan to move payroll to a new provider without missing a salary date or a filing: data, checks and a parallel run.

2026 CHANGES

Payroll rules that changed this year

If your payroll still runs on last year's formulas, these are the changes to check:

  • PF wage ceiling is now ₹25,000. From 17 September 2026 the PF wage ceiling rose from ₹15,000 to ₹25,000 a month, so more employees are covered and some deductions go up.
  • ESIC is checked on wages, not gross pay. Since 21 November 2025, ESIC coverage (₹21,000 limit) is worked out on wages under the Code on Social Security, which can bring more staff into ESIC.
  • The 50% wage rule. Under the Labour Codes, if allowances outside basic pay and DA are more than half of total pay, the excess is added back to wages for PF, ESIC and gratuity.
  • Minimum wages change during the year. States revise minimum wages and dearness allowance, so every payroll run should be checked against the current state rate.
  • New TDS forms. From FY 2026-27, quarterly TDS returns are filed in Form 138 and annual certificates are issued in Form 130.

We apply each change to your payroll for you. For more on the PF change, read our PF wage ceiling guide.

NEW PF COVERAGE

Newly covered by PF? Register the right way

PF & ESIC Registration Kit

Thresholds, documents and step-by-step EPFO and ESIC registration for small businesses crossing 10 or 20 employees.

PAYROLL FOR SMES

Who needs payroll outsourcing?

If you’re spending days every month on payroll instead of building your business, it’s time to hand it off.

  • ✓ Small businesses, startups and SMEs with 5 to 100 employees who need accurate, on-time payroll without a dedicated payroll team.
  • ✓ Companies operating across multiple Indian states, each state has different PT slabs, LWF rules and filing portals that need to be tracked.
  • ✓ Businesses that have faced penalties for late PF/ESIC/TDS filings and need a zero-miss system going forward.
  • ✓ Founders and ops leads who are currently doing payroll themselves and need to free up 3 to 5 days per month.
  • ✓ Companies with contract, gig and full-time workers on the same payroll platform needing unified processing.
  • ✓ Businesses preparing for audit or due diligence, clean payroll records and statutory compliance documentation matter.
WHY OUTSOURCE

The benefits of outsourcing your payroll

  • Zero missed deadlines. Every PF, ESIC, PT and TDS filing goes in before its due date.
  • No penalty exposure. Late filing interest and damages become our problem, not yours.
  • Days back every month. Your team stops running payroll and gets back to the business.
  • One flat starting price. From ₹10,000 a month, with no surprise per filing charges.
  • Audit ready records. Clean payslips, challans and registers, ready for due diligence.
  • Scales with you. From 5 employees to 500, across any number of Indian states.
THIRD PARTY PAYROLL

What is third party payroll?

Third party payroll means workers are paid and managed on a partner’s payroll rather than yours, which suits contract and project staff. HRTailor runs payroll for your own team. For third party payroll and contract staffing, we refer you to our sister company Team Management Services (TMS), who can set it up in 48 hours.

Talk to TMS about third party payroll →

PAYROLL PRICING

Transparent payroll pricing

No hidden fees. Pricing scales with your team size.

Custom Quote

Per-employee
For larger teams or multi-entity payroll
  • Everything in Payroll with compliance
  • Multi-state PT management across PAN India (28 states + Union Territories)
  • Contract & gig worker payroll
  • Custom reporting & MIS
  • HRMS integration
  • Bulk hiring payroll setup
Contact sales

For companies with more than 100 employees or complex multi-entity structures, contact us for customised pricing.

What does payroll outsourcing cost in India?

Here is what HRTailor charges per month (GST extra). The base fee covers up to 15 employees.

Team sizeWithout ComplianceWith Compliance (PF, ESIC, PT filing)
Up to 15₹10,000₹12,500
25₹14,000₹17,500
50₹24,000₹30,000
100₹44,000₹55,000

One-time setup fee of ₹30,000 to ₹50,000, based on team size. 6-month minimum, 3 months billed in advance. For comparison, an in-house payroll executive costs ₹25,000 to ₹50,000 a month before software, and a single late PF return attracts interest at 12% a year plus damages of up to 100% of the arrears.

HRTailor’s payroll outsourcing eliminates this risk entirely. See our payroll cost guide, or explore full HR outsourcing.

Get a quote →

CHOOSING A PARTNER

How to choose a payroll outsourcing company in India

Comparing payroll outsourcing companies in India? Here is what actually matters once you look past the top ten lists.

  • Compliance coverage. Do they handle PF, ESIC, PT, TDS, LWF and gratuity across every state you run in?
  • An accuracy guarantee. Is there a real QC process, and who pays if a filing is wrong? We fix it free, revised filings included.
  • Clear pricing. A flat, predictable fee beats add ons that quietly grow your bill.
  • A named contact. Will you get one person who replies, or a ticket queue?
  • Data security. Encrypted, access controlled, and aligned to the DPDP Act 2023.
  • The right fit. Enterprise providers over serve a 20 person startup. HRTailor is built for SMEs and moves you to Team Management Services once you cross 100 employees.
NEVER MISS A DEADLINE

Never miss a payroll deadline again

We take complete ownership off your plate, from inputs to statutory filing. One team, one process, zero missed deadlines.

Payroll live in 5 business days. Plans from ₹10,000/month. PF, ESIC and PT filing from ₹12,500/month.

● Trusted by startups & SMEs across India ● Dedicated Online HR Manager + team ● PF · ESIC · PT · TDS compliance built in ● From ₹10,000/month ● Replies within 1 business day
PAN-INDIA COVERAGE

Payroll outsourcing across India

We run payroll, compliance and HR support in every major Indian metro, and multi state teams are exactly what we are built for. Find your city below.

FAQS

Frequently asked questions

Reviewed by the HRTailor payroll and compliance team. Last updated: 2026-09.

What payroll software do you use?
HRTailor runs payroll on your existing system or on our partnered HRMS platform. Filing accuracy on PF, ESIC, PT and TDS matters more than the choice of tool.
What happens if there is an error?
Errors are corrected in the next payroll run and any statutory shortfall on PF, ESIC or TDS is refiled through the appropriate portal. The payroll SPOC owns the correction end to end.
Can you handle payroll for contract and gig workers?
HRTailor processes payroll for contract and gig workers already on your rolls. We do not source or place workers. Larger apprentice, EOR and contract-staffing engagements go to our sister company Team Management Services (TMS).
How is data security handled?
Employee data moves over encrypted channels and sits on the Indian data centres of the payroll platform. Access is role-based and limited to your named payroll contacts. Every change is logged.
What does payroll outsourcing cost?
Payroll is included in every HR Outsourcing plan. Without compliance it starts at ₹10,000 + GST a month for up to 15 employees, plus ₹400 per additional employee. With PF, ESI, PT and other statutory filings it is ₹12,500 + GST a month, plus ₹500 per additional employee. Larger bands and custom quotes are on the pricing page. The With Compliance fee covers salary run, PF, ESIC and PT challans, TDS Form 138 filing (replaced Form 24Q from 1 April 2026), digital payslips and a payroll SPOC.
Is payroll outsourcing worth it for a small business?
Usually, once you have more than a handful of employees. An in-house payroll executive costs ₹25,000 to ₹50,000 a month before software, and one late PF deposit brings interest and damages. Outsourcing gives a small business on-time filings and payslips for one monthly fee.
Payroll service or payroll software: which is better for a startup?
Software suits a startup with an in-house payroll expert who has time every month to enter inputs, apply rule changes and file returns. A payroll service suits founders and lean teams who want the processing, filings and employee questions handled. We can also run payroll on the software you already use.
What do we receive every month?
Payslips, the salary register and bank file, PF, ESIC, Professional Tax and Labour Welfare Fund challans with payment proof, TDS returns when due, full and final statements for exits, and an MIS report.
How is HRTailor different from Team Management Services?
HRTailor serves Indian SMEs and startups from 5 to 100 employees. Team Management Services (TMS) is the sister brand for 100+ employee corporates and handles EOR, contract staffing and IT recruitment. Same group, different scope.
Need enterprise payroll for 100+ employees or cross-border teams? Team Management Services handles large-scale workforce management. →
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HR Outsourcing across India

We deliver payroll, compliance and HR support in every major metro. Find your city below.

📍 Mumbai 📍 Bangalore 📍 Hyderabad 📍 Chennai 📍 Pune 📍 Ahmedabad 📍 Kolkata 📍 Noida & Delhi NCR

Explore related services & guides

HRTailor pricing & plans →HR outsourcing services →Statutory compliance services →PF & ESIC registration guide →HR outsourcing cost in India (2026) →Statutory compliance checklist 2026 →Top 10 payroll outsourcing companies in India (2026) →

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A ready salary-structure template - Basic, HRA, allowances, PF/ESI and take-home, all calculated for you.

The math, honestly

An in-house HR Manager costs ₹50,000 to ₹80,000 a month + benefits. HRTailor gives you a full HR pod + cloud HRMS from ₹10,000/month - a fraction of the cost, with no hiring risk.

  • No lock-in beyond your 6-month term
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  • Cancel anytime after the term
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Accurate, on-time payroll every month - PF/ESIC/PT/TDS filed for you.

Often paired with: Payroll · Statutory Compliance · HR Support

Included in your HR plan from ₹10,000/month
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