The Future of Payroll Software: Trends Accountants Should Know

Payroll is not what it used to be.

The accountants who stay on top of those changes will be the ones who succeed. Those who don’t get left behind as businesses flock to the new technologies and software solutions reshaping the industry.

The truth is…

The market for accountants payroll software is massive. In 2024 alone, the U.S. HR and payroll software industry generated $20.9 billion. That number continues to grow every year.

But what does this growth mean for accountants who are tired of tedious payroll work and want to serve more clients more efficiently?

Let’s break it down.

What you’ll learn:

• Why Payroll Software Is Important for Accountants
• Top Trends in Payroll Technology
• Evaluating the Best Tools for Your Practice
• Positioning Your Firm for the Future

Why Payroll Software Is Important for Accountants

Running payroll is not just about cutting a check.

Contemporary accountants are involved in tax compliance, managing multi-state payroll regulations and even administering employee benefits. Trying to do all of this manually is a great way to become overwhelmed and make mistakes.

The right best Payroll software for accountants can transform how a firm operates. It can automate the mundane and repetitive work, reduce errors and free up time for higher-value advisory services.

Here’s the issue:

Despite these obvious benefits, many firms are still stuck in the past. In fact, about 51% of organisations still use spreadsheets and manual processes for payroll. All of this equates to lost hours and potential compliance headaches.

The firms winning in this moment are the ones making investments in smarter technology.

Top Trends in Payroll Technology

The world of payroll software is evolving rapidly. There are a number of trends that are reshaping how accountants manage their client’s payroll operations.

Cloud-Based Solutions Are Becoming the Norm

The era of on-premise software is quickly coming to an end.

Cloud-based payroll systems are now the dominant solution on the market. They are preferred for their flexibility, real-time access and automatic updates with no IT headaches.

In fact, in 2024, around 74% of companies around the world had adopted at least one cloud-based HR software solution. This is a significant increase from just five years ago.

For accountants, cloud payroll solutions mean being able to access client data from anywhere, collaborating in real time and scaling the operation without huge infrastructure investments.

AI and Automation Are Transformative

Artificial intelligence is no longer the stuff of science fiction.

It is already being used to automate and enhance payroll processing. AI-enabled systems are able to handle tax calculations, error flagging, anomaly detection and compliance automatically.

According to Karbon’s 2025 report, 85% of accountants are either excited about or intrigued by the potential that AI could have on their work. And for good reason…

AI-driven payroll solutions have been shown to have some very significant results. For instance, a Deloitte study found that these systems were able to cut processing errors by as much as 75% and processing time by half.

This is not an incremental improvement. This is a fundamental change in efficiency.

Mobile Access Is Critical

There are no longer any accountants who are chained to their desks.

Accountants and their clients now expect mobile-friendly payroll tools. Employees want to be able to check their pay stubs on their phones. Business owners want to be able to approve payroll from anywhere.

Mobile-based HR software solutions saw a 61% increase in use across mid-sized companies in 2024 alone. This trend is not showing any signs of slowing down.

Self-Service Portals Empower Clients

Clients no longer want to email every single question they have.

Self-service portals empower employees to access their own payroll information, download tax forms and update personal information without having to email the accountant.

This not only lessens the administrative burden on accounting firms, but it also improves client satisfaction as employees get the answers they need instantly.

Approximately 70% of HR systems now offer customisable self-service dashboards for this exact purpose. For accountants who are managing multiple clients, this feature alone can save many hours per week.

Automated Compliance Minimises Risk

Tax regulations are in a constant state of flux.

Multi-state payroll adds another level of complexity on top of that. Trying to keep on top of it all manually is nearly impossible without making mistakes.

The next generation of payroll software handles compliance automatically. It updates tax tables, calculates withholdings accurately and generates the appropriate forms for each jurisdiction.

This is a game-changer for accountants. Compliance errors can result in penalties for clients and liability issues for the firm. Automated compliance tools make these mistakes far less likely.

How to Choose the Right Tools for Your Practice

Not all payroll software solutions are created equal.

Here’s what accountants should be considering when it comes to evaluating options:

Integration capabilities. Seamless integration with existing accounting systems, time tracking tools and benefits platforms is critical. The less manual data entry, the better.

Scalability. A system that works well for ten clients may not hold up once the firm expands to fifty. Software should be able to scale without needing a complete overhaul.

Compliance capabilities. Multi-state and multi-jurisdiction support is essential. The solution should be able to handle differing tax requirements across different areas with ease.

Reporting and analytics. Payroll software shouldn’t just process payments. It should be able to provide insights that can help an accountant provide better advice to their clients around labour costs, overtime trends and workforce planning.

Client experience. How will the clients interact with the system? A clunky, non-intuitive interface is frustrating for all involved. A clean, modern design can make adoption much easier.

Preparing Your Firm for the Future

The landscape for payroll software will continue to shift.

Firms that are able to adapt and leverage new tools will gain more market share. Those that resist and refuse to change will struggle to compete with leaner, more efficient competitors.

Begin with an honest assessment. Look at the current workflow and identify where the bottlenecks and time-consuming, manual tasks are. Those are the areas ripe for automation.

Invest in training. New software is only as valuable as the team that uses it. Allocate time and resources for proper onboarding and ongoing training.

Stay up to date. The technology in this space is advancing quickly. Subscribe to industry publications. Attend webinars. Network with other accountants that are early adopters.

Focus on the long-term. The cheapest solution today may be more expensive in the long run if it doesn’t scale or doesn’t have all of the critical features that are needed. Look at total cost of ownership, not just the monthly subscription price.

Wrapping Things Up

The future of payroll software is bright for accountants that are willing to embrace it.

Cloud-based systems offer flexibility and real-time access to data. AI and automation reduce errors and save time. Mobile tools and self-service portals improve both efficiency and client satisfaction. And automated compliance tools reduce risk on all fronts.

The market for accountants payroll software is not slowing down. Firms that make smart investments in these technologies will be well-positioned to serve more clients, lower overheads and create more value for clients.

The only question is not if accountants should modernise their payroll processes…

But how quickly they are willing to get started.