What is embedded payroll?
Embedded payroll is payroll offered inside another software product, such as a vertical business platform, accounting tool or bank, rather than as a separate payroll system. The platform builds the screens its customers use, while a payroll provider supplies the calculations, tax filings, payments and compliance through APIs and embeddable components.
Also calledpayroll APIpayroll as a servicewhite-label payroll
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- Delivered through
- APIs and embeddable components
- Provider handles
- Calculations, filings, payments
- Most developed in
- United States
How embedded payroll works
The platform connects to the provider's APIs to onboard employers and employees, collect hours and pay rates, run payroll, show payslips and move money. The provider calculates gross-to-net pay and tax withholding, files payroll tax returns and year-end forms, and handles the payment rails and tax registrations, so the platform does not have to become a payroll company itself. Platforms use it to keep customers inside their product and earn revenue per payroll run; their customers get pay data next to their scheduling, invoicing or banking. The model is most developed in the United States, where Check provides payroll infrastructure across all states and Gusto offers an embedded version of its payroll.
Common questions
Who uses embedded payroll?+
Software platforms for specific industries, accounting and HR tools, and banks and fintechs that want to offer payroll to their business customers without building payroll themselves.
Who is responsible for tax filings in embedded payroll?+
Usually the payroll provider behind the platform, which files payroll taxes and year-end forms for each employer; the exact split is set in the provider's agreement with the platform.
How is embedded payroll different from a payroll integration?+
An integration links two separate systems. Embedded payroll runs inside the platform's own product, so the customer never uses a separate payroll application.
Embedded payroll providers
Part of Accountio’s accounting technology coverage · Glossary
