In 2026, payroll software in India costs 30 to 180 rupees per employee per month. For a 60-person company that is about 29,000 to 1.2 lakh a year, depending on the vendor and the plan, with free tiers for teams under 10 to 25 people. Custom payroll software costs 15 to 40 lakh to build and is almost never worth it.
The reason is in what the fee actually buys. It is not the salary arithmetic. It is a subscription to the statutory change log, and in the last six months that log moved twice: the Income-tax Act, 2025 took effect on 1 April 2026 and changed how salary tax is withheld, and the EPF wage ceiling rose from 15,000 to 25,000 rupees on 17 September 2026. Whoever owns the payroll code had to change it both times. You want that to be someone else.
What does payroll software cost per employee?
| Vendor and plan | Base | Per extra employee | A 60-person company |
|---|---|---|---|
| Zoho Payroll, Standard | About 1,000 a month for 25 employees | 40 a month | About 2,400 a month, 28,800 a year |
| greytHR, Essential | About 3,495 a month for 50 employees | 35 a month | About 3,845 a month, 46,000 a year |
| RazorpayX Payroll, Elite | About 5,499 a month for 50 employees | 120 a month | About 6,700 a month, 80,000 a year |
| Keka, Foundation | About 9,999 a month for 100 employees | 90 a month | About 10,000 a month, 1.2 lakh a year |
Prices are published list prices in 2026, before 18 percent GST, which is claimable as input credit if you are registered. greytHR offers a free plan for up to 25 employees and Zoho has a free tier for very small teams. Keka's higher base fee buys a full HR system, with attendance, leave, performance and onboarding alongside payroll, which is why it is positioned for larger companies.
Per head, that is 40 to 170 rupees a month at 60 employees, and the market summary of 30 to 180 holds across most vendors. Set against the payroll itself, it is small: a 60-person company paying an average of 40,000 a month runs a 24 lakh monthly payroll, and 3,600 rupees of software is 0.15 percent of it.
The per-employee shape is the same one Indian software uses everywhere: per vehicle in fleet software, per flat in society apps, per student in school ERP, per bed in hospital systems. The published rate is rarely the whole bill, so here is the rest of it.
What does the first year actually cost?
For the same 60-person company, choosing a mid-priced plan:
| Line | Typical cost |
|---|---|
| Subscription, 60 employees | 29,000 to 80,000 |
| Setup and data migration, if the vendor charges | 0 to 25,000; some charge a percentage of the annual fee |
| Your HR or accounts person's time to migrate | A week, once |
| Attendance hardware, if you want biometric punch-in | 8,000 to 25,000 per device |
| Add-on modules: expenses, performance, recruitment | 10 to 60 rupees per employee per month each |
| GST at 18 percent | On all of the above, claimable if registered |
| First year, realistic | 50,000 to 1.5 lakh |
The number that grows is the add-ons. Payroll alone is cheap; payroll plus attendance plus leave plus expenses plus performance is an HR system, priced per employee per module, and that is how a 40-rupee plan becomes a 200-rupee one.
Why the fee is really a compliance subscription
Two changes in six months show what you are paying for.
The EPF wage ceiling. On 17 September 2026 the ceiling for mandatory provident fund contributions rose from 15,000 to 25,000 rupees a month. Contribution rates stayed at 12 percent each side, but every employee earning between those two figures became mandatorily covered, and for anyone already covered the employer's contribution rose by up to 1,200 rupees a month. September's payroll had to be split at the 17th, and the first affected return was due on 15 October. Every payroll vendor shipped that change to every customer at once. A company running its own payroll code had to find a developer in the same fortnight.
The new income tax law. The Income-tax Act, 2025 replaced the 1961 Act from 1 April 2026. For payroll, the new tax regime became the default for withholding, employees who want the old regime now declare it on a prescribed form, and the section numbers, certificates and quarterly returns were renumbered. Confirm the current forms with your payroll adviser, because secondary sources still disagree on some of the mappings. Again, the vendors absorbed it; a custom system absorbs it only if someone is paid to make it.
That is the whole argument against building. A 15 to 40 lakh custom payroll system does the arithmetic once and then needs a developer on call for the rest of its life, for a function that costs 40 rupees a head to rent.
When is building anything worth it?
Not the payroll engine. What some companies genuinely need to build is the layer around it, where their operation differs from an office:
- Site attendance and rosters for construction, facilities and field service, where people work shifts across locations and the attendance data has to reach payroll correctly.
- Contract labour and piece rates, where pay is per unit produced or per shift at a client site, with statutory deductions still applied.
- Multi-entity groups that need one view across several registered companies.
That layer costs 3 to 8 lakh to build, in the same range as any single feature in our app development cost guide, and it should push clean data into a rented payroll engine rather than replace it. Staffing firms, security agencies and manufacturers with large contract workforces are the usual buyers.
What moves the price
- Headcount, obviously, and the tier boundaries: most plans step at 25, 50 and 100 employees.
- How many modules you switch on beyond payroll.
- Attendance hardware and whether it integrates or has to be imported monthly.
- Multiple entities or states, each with its own professional tax and registrations.
- Implementation, which is cheap when your employee data is clean and expensive when it lives in three spreadsheets.
How to read a payroll software quote
- Ask for the price at 1.5 times your headcount, because that is the number you will be paying in two years.
- Ask which statutory updates are included and how quickly they ship. The September EPF change is a fair test: ask what day their customers had it.
- Ask what the export looks like if you leave. Payroll history is a legal record you must keep.
- Ask about GST on the invoice. It is claimable, so budget the pre-tax figure.
Questions people ask
How much does payroll software cost in India?
Thirty to 180 rupees per employee a month on paid plans, before GST. A 60-person company pays about 29,000 a year on Zoho Payroll, 46,000 on greytHR, 80,000 on RazorpayX Payroll and 1.2 lakh on Keka, which bundles a full HR system. Free plans exist for teams under 10 to 25 people.
Is there free payroll software in India?
Yes, for small teams. greytHR's free plan covers up to 25 employees with payroll and employee self-service, and Zoho offers a free tier for very small companies. Beyond those limits the paid plans start at about 1,000 to 3,500 rupees a month.
How much does it cost to build custom payroll software?
Fifteen to 40 lakh to build, plus a developer on call for every statutory change, of which there were two in the six months to September 2026. We do not recommend it. Build the attendance, roster or contract-labour layer your business needs, for 3 to 8 lakh, and feed a rented payroll engine.
What changed in payroll compliance in 2026?
The Income-tax Act, 2025 took effect on 1 April 2026, making the new tax regime the default for salary withholding and renumbering the forms and sections. The EPF wage ceiling rose from 15,000 to 25,000 rupees from 17 September 2026, bringing more employees under mandatory coverage and raising employer contributions by up to 1,200 rupees a month per affected employee.
Is payroll software worth it for 10 employees?
Yes, and it is usually free at that size. The value is not the calculation, it is the compliance: challans, returns and the statutory updates arriving without you tracking them.
What is the difference between payroll software and HRMS?
Payroll software calculates salaries, deductions and statutory filings. An HRMS adds attendance, leave, onboarding, documents, performance and recruitment, priced per employee per module. Most small companies need payroll first and grow into the rest.
Getting a real number
If your question is which payroll plan to buy, the table above and a free trial will answer it in an afternoon. If your question is the layer around it, the site attendance, rosters or contract-labour system that your operation needs and no plan provides, that is what we build. What that looks like is on our web and SaaS development page.