Free Payroll Software UK 2026

Seven UK payroll tools are genuinely free in 2026 – but only two handle auto-enrolment, payslips, and RTI submissions without charging a penny. HMRC’s Basic PAYE Tools covers the legal minimum for up to 9 employees, while Collegia FreePayroll offers unlimited employees with cloud access and a 4.9 Trustpilot rating.

This guide covers every free payroll option available to UK businesses, what each one actually includes, and at what point the limitations force you into paid software. All features and availability verified February 2026.

Free Payroll Software Comparison

Collegia FreePayroll is the only genuinely free UK payroll software with unlimited employees, auto-enrolment, payslips, and HMRC RTI – no hidden fees or time limits.

Collegia FreePayroll handles unlimited employees, RTI, auto-enrolment, payslips, and P60s at no cost – the standout free payroll option for UK businesses in 2026.

Collegia FreePayroll is the only UK payroll software that is genuinely free with no employee cap, no time limit, and no hidden upgrade requirement. It launched in 2023 as a cloud-based alternative to HMRC’s Basic PAYE Tools and has rapidly built a strong reputation, holding a 4.9/5 Trustpilot rating from over 200 reviews.

The free tier includes everything a small business needs: HMRC RTI submissions (FPS and EPS), automatic tax and NIC calculations, payslip generation (email and PDF), auto-enrolment pension management, P45/P60 production, and year-end reporting. It supports weekly, fortnightly, four-weekly, and monthly pay schedules.

FreePayroll makes money through optional add-ons – bureau tools for accountants (£1/payslip) and a premium support tier. The core payroll product stays free. This model means the software is sustainable without pushing free users onto paid plans.

Limitations: No phone support on the free plan (email and live chat only). No HR features – this is payroll-only software. No BACS payment integration on the free tier (you process payments manually through your bank). The interface is clean but basic compared to premium tools like Sage or Employment Hero.

HMRC Basic PAYE Tools is free government software for up to 9 employees that handles RTI submissions but cannot generate payslips or manage auto-enrolment.

HMRC provides Basic PAYE Tools (BPT) as free payroll software for UK employers. It is a desktop application (Windows, Mac, and Linux) that handles the core legal requirements of running PAYE payroll – calculating tax and National Insurance, submitting Full Payment Submissions (FPS) and Employer Payment Summaries (EPS) to HMRC, and recording employee starter and leaver details.

BPT is limited to 9 employees. If you have 10 or more, HMRC directs you to commercial payroll software. Even within the 9-employee limit, the tool is bare-bones: it does not generate payslips (you must create these separately – a legal requirement), does not handle auto-enrolment pension duties, does not process CIS returns, and does not manage BACS payments.

For sole traders employing 1-3 people who only need to stay compliant with HMRC reporting, BPT is adequate. For any business with pension obligations or more than a handful of employees, the limitations make it impractical. Collegia FreePayroll does everything BPT does plus payslips, auto-enrolment, and unlimited employees – also for free.

Employment Hero offers a free HR platform for unlimited employees, but payroll is a paid add-on starting from £4/employee/month with a £90 minimum billing threshold.

Employment Hero is not free payroll software – but its free HR plan is worth mentioning because many businesses searching for free payroll actually need HR management. The free HR tier includes onboarding workflows, employee self-service, document storage, leave management, and an employee directory for unlimited users.

Payroll is available as an add-on from £4/employee/month (minimum £90 billing). While that is not free, Employment Hero’s value is in bundling HR and payroll together. If you use Collegia FreePayroll for payroll and Employment Hero for HR, you get a comprehensive people management stack with only the payroll component costing nothing.

For businesses that plan to grow beyond 10-20 employees, starting with Employment Hero’s free HR plan and adding payroll later avoids the disruption of switching systems. The platform scales from 1 to 1,000+ employees without changing software.

Primo Payroll is free for one employer with up to 5 employees, offering cloud-based RTI, payslips, and auto-enrolment – ideal for new micro businesses.

Primo Payroll offers a free tier for a single employer with up to 5 employees. It is cloud-based (accessible from any browser), HMRC-recognised, and includes RTI submissions, payslip generation, auto-enrolment management, and statutory payment calculations (SSP, SMP, SPP).

The free plan is more generous than HMRC’s Basic PAYE Tools in terms of features – you get payslips and auto-enrolment – but more restrictive on employee count (5 vs 9). For businesses with exactly 1-5 employees, Primo is a strong option. For 6-9 employees, HMRC BPT handles RTI but you would need separate payslip and pension solutions.

Paid plans start at £2.50/employee/month for additional employers or employees beyond 5. Primo is popular with accountants running payroll for multiple small clients – the bureau features allow managing several employers from one dashboard.

Shape Payroll provides free cloud payroll for up to 5 employees per company, with RTI, payslips, and auto-enrolment included – a solid option for new startups.

Shape Payroll is a cloud-based payroll platform offering a free tier for up to 5 employees per company. It includes HMRC RTI submissions, payslip generation, auto-enrolment management, and statutory calculations. The software is HMRC-recognised and handles the full payroll cycle from calculation through to submission.

Shape targets accountants and bookkeepers as well as small businesses. The free plan allows a single company with up to 5 employees – additional companies or employees require a paid subscription. This makes it directly comparable to Primo Payroll in terms of free-tier limits.

The platform includes a clean, modern interface and email support on all plans. For startups with fewer than 5 employees who want a simple cloud solution, Shape is a viable alternative to Primo and Collegia.

EnrolPay is a free auto-enrolment management tool for unlimited employees – useful if you already run payroll but need help with pension compliance.

EnrolPay is not a full payroll solution – it is a free tool specifically for managing auto-enrolment pension duties. If you already run payroll through another system (including HMRC BPT) but struggle with auto-enrolment compliance, EnrolPay handles assessment, communication, and pension provider submissions at no cost.

The tool covers employee assessment (who qualifies for auto-enrolment), opt-in/opt-out processing, pension contribution calculations, and submissions to major pension providers including NEST, The People’s Pension, and NOW: Pensions. There is no employee cap – it works for any size of business.

This is a niche tool rather than a payroll replacement. It pairs well with HMRC Basic PAYE Tools, which handles RTI but cannot manage auto-enrolment. Together, the two free tools cover PAYE compliance and pension duties – though you still need separate payslip generation.

1st Money is a free RTI submission tool with no employee limit, but it lacks payslips and auto-enrolment – primarily useful for HMRC reporting only.

1st Money provides free RTI submission software for unlimited employees. It is HMRC-recognised and handles Full Payment Submissions (FPS) and Employer Payment Summaries (EPS). Unlike HMRC’s Basic PAYE Tools, there is no 9-employee cap – you can submit RTI for any number of employees.

The software is web-based (no installation required) and includes basic tax and NIC calculations. However, it does not generate payslips, manage auto-enrolment, or handle CIS. It is essentially a more scalable version of HMRC BPT – useful if you have 10+ employees and only need RTI compliance, but you will need additional tools for payslips and pensions.

For most businesses, Collegia FreePayroll is a better choice because it handles RTI, payslips, and auto-enrolment in one place – also for free. 1st Money is worth considering only if you have a specific workflow that requires a standalone RTI tool.

When Free Payroll Software Is Not Enough

Free payroll software works for businesses under 20 employees with simple pay structures – upgrade to paid software when you need BACS, HR features, or phone support.

Free payroll tools handle the basics well – tax calculations, RTI submissions, payslips, and auto-enrolment. But there are clear signs you have outgrown them:

• You need BACS payments: No free tool processes BACS. If you are manually transferring salaries through your bank each month, paid software automates this completely.
• You have complex pay structures: Multiple pay rates, overtime rules, commission, or shift allowances are difficult to manage in basic free software.
• You need HR features: Absence tracking, document management, performance reviews, and onboarding workflows require paid HR or combined HR/payroll platforms.
• You want phone support: Free tools typically offer email or chat support only. When payroll goes wrong on payday, phone support matters.
• You employ 20+ people: The administrative overhead of manual processes (bank transfers, individual payslip distribution) becomes unsustainable at this scale.

The most affordable paid upgrade is Moneysoft Payroll Manager at £90/year (£7.50/month). For cloud payroll, Sage Payroll starts at £20/month. See our cheap payroll software guide for a full cost comparison.

Free vs Cheap Paid Payroll: Cost Comparison

Moneysoft at £90/year is the cheapest paid UK payroll – three times more capable than any free tool, with BACS, CIS, and full reporting included.

For most businesses under 20 employees without CIS or BACS requirements, Collegia FreePayroll delivers genuine value at zero cost. When you need those extras, Moneysoft at £90/year is the most cost-effective step up. Cloud-first businesses should look at Sage Payroll from £20/month.

How to Choose the Right Free Payroll Software

Choose Collegia FreePayroll for all-round free payroll, HMRC BPT for RTI-only compliance, or Primo/Shape if you have 5 or fewer employees.

Picking the right free payroll tool depends on three factors: how many employees you have, what features you need, and whether you plan to grow.

Under 5 employees: Any free tool works. Primo Payroll and Shape Payroll both offer full-featured payroll (RTI, payslips, auto-enrolment) within their 5-employee free tier. Collegia FreePayroll also works but offers no additional features at this scale.

5-9 employees: Collegia FreePayroll is the clear winner – it is the only free tool with no employee cap that includes payslips and auto-enrolment. HMRC BPT handles RTI but you would need separate tools for payslips and pensions.

10+ employees: Collegia FreePayroll is the only free option. HMRC BPT caps at 9, and Primo/Shape cap at 5. If Collegia’s limitations (no BACS, no phone support) are dealbreakers, consider budget paid software from £90/year.

Planning to grow: Start with Employment Hero’s free HR plan for HR management, pair it with Collegia for payroll, and add Employment Hero’s paid payroll add-on when your budget allows. This avoids switching platforms later.

Our Verdict

Collegia FreePayroll is the best free payroll software in the UK for 2026 – unlimited employees, full RTI, payslips, and auto-enrolment at genuinely zero cost.

Collegia FreePayroll stands out as the only UK payroll software that is truly free with no meaningful restrictions. Unlike HMRC’s Basic PAYE Tools (9-employee cap, no payslips), Primo Payroll (5-employee cap), or Shape Payroll (5-employee cap), Collegia handles unlimited employees with all the features a small business needs – RTI, payslips, auto-enrolment, and year-end reporting.

If you only need RTI compliance for 1-9 employees and are comfortable creating payslips manually, HMRC Basic PAYE Tools is the most established option. For businesses that want HR management alongside payroll, Employment Hero’s free HR plan paired with Collegia gives you both at no cost.

When you outgrow free software – typically when you need BACS payments, CIS returns, or phone support – the cheapest paid option is Moneysoft at £90/year. For cloud payroll, Sage starts at £20/month. For a full comparison, see our best payroll software UK guide, or check what payroll software actually costs at different company sizes.

Related payroll guides:

• Best Payroll Software UK 2026
• Cheapest Payroll Software UK
• Moneysoft Payroll Manager Review
• Best Outsourced Payroll Companies UK
• Payroll Costs Guide
• HR and Payroll Software
• Xero Payroll Review
• Staffology Review

Clara Wenslow

Finance & Business Services Editor

Clara analyses SME finance and procurement markets, covering business loans, invoice finance, payroll, and related B2B services. She ensures each comparison and guide is transparent and data-driven.

Reviewed by

Sarah Mitchell

B2B Commerce & Finance Reviewer