Pricing payroll bookkeeping is tricky because the work varies widely — a 5-employee client on weekly payroll is much more work than a 15-employee client on monthly payroll. Here's how to price it fairly and profitably.
Common pricing models
Flat monthly fee per client
Most common for established bookkeeping firms. Set a base fee and adjust for complexity factors:
- Base rate: $75–$150/month per client (solo bookkeeper), $150–$300/month (firm)
- Add for each additional pay frequency beyond monthly: +$30–50/month
- Add for multi-state payroll: +$25–75/month per additional state
- Add for more than 15 employees: +$3–5/employee/month over the base
Per-payroll-run pricing
Charges per run rather than per month. Works well for clients with variable pay frequency:
- $35–$75 per payroll run (journal entry + reconciliation)
- Minimum monthly fee: $50–$100
Hourly billing
Rarely the best model for payroll — it doesn't reward efficiency. If you use it, $75–$125/hour is typical. Switch clients to flat-fee once you know your true time cost.
How to calculate your true cost
Track time for one month across all payroll clients. Divide total revenue by total hours. If you're under $75/hour, your rates need to go up or your process needs to get faster.
How PostBooks affects your pricing power
When a payroll journal entry takes 5 minutes instead of 45, your effective hourly rate on that task goes from $60 to $540 (at the same flat fee). Automation tools pay back quickly. Try PostBooks free for 14 days.