For any organization, payroll management is important because it ensures accurate and timely payment to employees, contributing to their retention and satisfaction. Payroll management software ensures compliance with tax regulations and labor laws, avoiding legal issues and penalties.  

With so many options available, companies often struggle to choose the right payroll solution. Paylocity and QuickBooks are two industry favorites that simplify payroll management, including employee wage calculations and tax report submissions. 

This Paylocity vs QuickBooks guide will compare software based on top features offered, pros and cons, and AI functionalities to help you decide which payroll management software is best for your business.  

But, which one among them is a better fit for your company? Find out the answer in this comprehensive Paylocity vs QuickBooks comparison.  

Paylocity Vs QuickBooks: At A Glance

Feature 

Paylocity 

QuickBooks 

AI-Powered Invoicing 

Airbase integration provides automated, AI-powered invoice processing and coding, no native AI-powered invoicing 

Advanced AI-powered invoicing with machine learning, automated invoice creation, real-time payment tracking, and personalized reminders  

Time and Attendance 

Integrated time tracking with geofencing, IP restrictions, and a self-service portal, plus mobile clock-ins, error notifications, and robust reporting for attendance and scheduling  

Basic time tracking with GPS support and mobile timesheets, employees can clock in and out from anywhere 

Payroll Software 

A full-service payroll system with automation, compliance support, and multi-state taxation 

Ideal for small businesses, automated payroll, tax filing, and seamless integration with QuickBooks Accounting  

HR Software 

A comprehensive HRIS with onboarding, compliance, document storage, benefits administration, and employee engagement tools  

Basic HR features such as employee profiles, lacks advanced onboarding and compliance management tools  

Tax Compliance and Filing 

Automates federal, state, and local tax filing, supporting distributed teams and complex tax rules for multi-state compliance  

Covers federal and state taxes, offers tax penalty protection in higher tiers, but has limited multi-state support  

What Is Paylocity?

Paylocity HR & Payroll is a cloud-based human capital management (HCM) solution that automates the complex payroll processes, including wage calculations, tax filings, direct deposits, and garnishment management. Furthermore, it offers dedicated tax support and seamless integration with timekeeping and benefits systems. 

Paylocity integrations allow seamless data exchange with other systems and services, improving accuracy and operational efficiency. This ensures timely and accurate payments across 100+ countries. 

Standout Features Of Paylocity  

  • Wage Garnishment Management: With Paylocity, companies can do hassle-free management of wage garnishment. It also has a dedicated team that handles every step of the process to ensure compliance and avoid costly mistakes 
  • Dedicated Tax Support: Paylocity offers expert support for tax filing and compliance in all 50 states. It also acts as a Registered Reporting Agent with IRS 
  • Expense Management Integration: Paylocity has made it easier for companies to use an integrated expense management system. Through this system, the reimbursements are automatically added to pay checks, reducing the need for manual data entry 
  • Automated Payroll Processing: With this software, companies can automate their core payroll tasks, such as tax withholdings, wage calculations, compliance monitoring, and direct deposits. It reduces manual efforts and the risk of errors 

Pros And Cons of Paylocity 

Pros  

  • Efficiently tracks the employee hours, payroll benefits, and time off, hence, maximizing their satisfaction 
  • Offers comprehensive payroll management including features like detailed pay stub breakdowns and tax reporting integrations 
  • Provides early wage access to the employees, with no impact on cashflow or payroll processing  

Cons 

  • The reporting system is not user-friendly. Users face issues with selecting the relevant fields into reports, which hinders efficient payroll analysis 
  • The clock-in/clock-out feature can be problematic. Limited connectivity to the server can result in missed punches when checking in or out 

What Is QuickBooks?

QuickBooks  is a software suite that offers a number of functionalities including accounting and payroll solutions for managing personal, business, and tax finances. It eliminates the need for manual data entry and organizes payroll information for companies.  

Furthermore, it also offers tools for attaching multiple documents, including receipts and quotes. Using these, businesses can keep track of important data files. QuickBooks has simplified the tasks such as bookkeeping, invoicing, bank reconciliation, budgeting, and sales tax management 

Standout Features Of QuickBooks 

  • Cloud-Accounting: Multiple clients can login to QuickBooks in real-time from any location around the globe. This makes it ideal for running seamless accounting practices 
  • Cash Flow Control: Using QuickBooks, enterprises can see their historical cash flows to understand where they need to save and where to spend money. They can also increase their cash flow by a 3.00% APY (annual percentage yield)  
  • Bill Payment Records: QuickBooks auto-imports bill payments from linked accounts like Apple Pay® or PayPal. It then matches them to vendor invoices for accurate, efficient tracking. 
  • Advanced Tools: QuickBooks Online Advanced enhances productivity with custom dashboards, workflow automation, and batch invoicing. These tools streamline tasks and improve efficiency. 

Pros And Cons of QuickBooks 

Pros  

  • Integration with an in-built accounting module ensures automatic syncing of payroll data and reduces reconciliation errors 
  • Automates paycheck generation and tax calculations, helping companies save time and avoid costly errors 
  • Supports direct deposits for employees and payments to 1099 contractors, while also including automated 1099 form filing 

Cons 

  • Advanced accounting features such as complex reporting and industry-specific tools can be challenging 
  • Limited payroll schedule options e.g. there is no option for quarterly payroll  

Paylocity Vs QuickBooks: A Cross Comparison Of Features

AI-Powered Invoicing

Paylocity is basically an HR, payroll and workforce management platform, and its core strength lies in the automation of HR tasks. Primarily, it handles payroll calculation, employee onboarding, and time tracking, but it doesn’t specialize in financial invoicing. Currently, AI-powered invoicing is not included in its service suite. However, its Airbase integration allows users to perform automated invoice processing and coding.

On the other hand, QuickBooks excels in accounting and invoicing, using AI to personalize and streamline these processes. It leverages machine learning to categorize expenses and match transactions. Additionally, it can generate cash flow projections and assist with smart invoice tracking.

Moreover, based on past billing data and recurring invoices, it can generate predictive suggestions. Detecting overdue payments and sending automatic reminders are also core features of the software.

Winner: QuickBooks is a better option when it comes to invoicing as it offers an AI-powered automated invoicing experience. Paylocity lacks this capability entirely, and it is not designed for accounting or carries specific client billing functions.

Time And Attendance

With clock-in and clock-out tracking, Paylocity helps maintain accurate records for all employees, minimizing payroll discrepancies. It offers both mobile and desktop access, along with geofencing and IP restrictions. Through the self-service portal, employees can submit or approve hours, view pay stubs, and more.

QuickBooks also offers an option for mobile and desktop clock-in/clock-out with GPS tracking. Through the employee self-service portal, employees can submit time-off requests and access scheduling tools. Since QuickBooks is not designed for HR or time tracking, it lacks some advanced functionality when it comes to time and attendance of employees.

Winner: Paylocity wins this round for its diverse workforce management capabilities. QuickBooks is more focused on the straightforward tracking of time and accounting integration. However, for efficient time and attendance tracking, Paylocity is a good choice.

Payroll Processing

Paylocity is a full-service payroll system that is designed for growing companies needing robust automation and compliance. It supports tax calculations, filings, wage garnishments, and mobile payroll approvals. It can also handle multi-state taxation and payroll cost tracking across different departments.

On the other hand, QuickBooks is ideal for automatic payroll runs, tax filings, and same- or next-day direct deposits. It processes payroll in under 5 minutes with guaranteed accuracy.

Winner: For small companies, QuickBooks works quite well, but to cater to growing businesses with complicated payroll needs, Paylocity stands out as more scalable and powerful.

HR Management

Paylocity is a full-fledged human resource information system (HRIS) including tools for hiring, onboarding, compliance management, document storage, employee recordkeeping, and reporting. It can automate many HR processes, from sending offer letters to collecting electronic signatures, tracking certifications, and managing policies.

Paylocity also provides an organizational chart, employee directory, and compliance alerts. For HR professionals who are looking to centralize and digitize all aspects of the employee lifecycle, this platform can usually be considered a one-stop solution.

QuickBooks offers very limited HR functionality. It is known for providing basic employee profiles and access to pay documents through QuickBooks Workforce, but it doesn’t include robust HR features like onboarding workflows, document management, or compliance support. If the companies want to achieve a similar HR setup, businesses must integrate with third-party HR apps, which can further create complexity.

Winner: Paylocity is ideal for companies that are seeking an all-in-one HR and payroll platform, while QuickBooks is better suited for businesses having minimal HR needs.

Tax Compliance And Filing

Paylocity provides fully automated tax compliance and filing service at federal, state, and local levels. It’s designed for organizations operating in all 50 US states, which makes it especially valuable for businesses having distributed teams or complex tax obligations.

The platform automatically calculates, withholds, and files taxes, including Social Security, Medicare, unemployment, and state-specific taxes. Moreover, it also handles year-end tax documents like W-2s and 1099s, hence allowing employees to access them digitally.

QuickBooks Payroll also offers automated tax calculation and filing, but it’s more tailored to small business needs. It is also known for covering federal and state tax filings, including payroll taxes and end-of-year forms like the 1099s. For businesses that have a straightforward payroll structure and limited state presence, QuickBooks Payroll can handle the task efficiently.

Higher-tier plans include tax penalty protection, with QuickBooks taking responsibility for errors. However, its multi-state tax support, multiple currency calculations, and configuration options are limited compared to Paylocity.

Winner: QuickBooks only works well for small businesses requiring basic and cost-effective payroll management. For broader, more complex tax scenarios and compliance needs, Paylocity offers more depth and support. Hence, Paylocity will be the winner when it comes to tax compliance and filing services.

Final Verdict – Which Payroll Management Software Is Better?

With a 4:1 verdict in favor of Paylocity, it may appear to be the superior choice. However, the final decision ultimately depends on your business’s specific needs, as both platforms offer comparable features. 

QuickBooks is better suited for small businesses with straightforward payroll needs. It delivers reliable tools like automated tax filings, AI-powered invoicing, and same-day direct deposits. That said, it lacks the flexibility and depth required for larger operations. 

Whereas, if you're seeking a scalable and full-service payroll solution, Paylocity stands out with its multi-state tax compliance, mobile payroll approvals, wage garnishments, and broad integration capabilities, making it a strong fit for growing businesses. 

Still unsure which platform suits your needs best? Contact us now and our research expert can walk you through the options and help you make the right choice.