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In this article
- Why NZ payroll is different from everywhere else
- Employment Hero: Full HR and payroll in one platform
- PayHero: The NZ-native payroll specialist
- Smartly: Managed payroll option for time-poor owners
- Head-to-head: What a 5-person NZ business would pay
- iPayroll and MYOB: worth considering
- Who should pick what
- The Holidays Act question
- Integrations that matter for NZ businesses
- Final verdict
If you've ever run a fortnightly payroll in New Zealand and wondered whether you've calculated Holidays Act leave correctly, you'll know the anxiety. The Holidays Act 2003 is notoriously complex, and most global payroll tools handle it badly or not at all. That's why this comparison sticks to tools built for or genuinely adapted to the NZ compliance environment.
Three names come up constantly when NZ small businesses go looking: Employment Hero, PayHero, and Smartly. Here's what each actually costs, where they differ, and which one suits which type of business.
Why NZ payroll is different from everywhere else
Before you can pick a tool, it helps to understand what makes NZ payroll tricky. Three things catch businesses out:
- Holidays Act 2003 leave calculations: ordinary weekly pay vs average weekly earnings vs relevant daily pay. Most tools auto-calculate this, but they often do it wrong.
- KiwiSaver auto-enrolment: new employees are automatically enrolled at 3% unless they opt out. Payroll software needs to handle enrolment, opt-outs, employer contributions, and IRD filing.
- ACC levies: employer and employee ACC levies are deducted via payroll and change annually. Global tools often show these as a manual override rather than an automatic calculation.
A payroll tool that doesn't handle these natively forces you to do manual corrections. That's the real cost hidden in the "cheaper" option.
Employment Hero: Full HR and payroll in one platform
Employment Hero is the biggest player in the AU/NZ HR software market. For NZ businesses, it splits into two modules you can run together or separately: the HR platform and the payroll system.
NZ pricing (excl. GST, source: Employment Hero price list via G2):
| Module | Plan | Price |
|---|---|---|
| HR | Premium | $10/employee/month |
| HR | Platinum | $16/employee/month |
| Payroll | Standard | $4/employee/month |
| Payroll | Premium | $6/employee/month |
For a five-person business on HR Premium + Payroll Standard, that's 14/employee/month, or * *70/mo NZD** excl. GST. That's the entry point for the full stack.
What you get at that tier: paperless onboarding, leave requests and approvals, KiwiSaver management, Holidays Act-compliant pay calculations, Xero integration, IRD filing, and an employee self-service app. The HR Premium plan also includes performance reviews and basic compliance documents.
The Platinum tier adds applicant tracking, custom reporting, and API access. Payroll Premium adds rostering, time tracking, and PowerBI reporting.
Who it's for: Businesses that want HR and payroll in one place and are ready to pay for it. Great for 10-50 employees where managing contracts, leave, and onboarding separately is getting painful.
Where it falls short: The pricing stacks up fast if you only need payroll and not the HR module. A ten-person business paying for both modules pays $140/mo NZD just for the base tier.
PayHero: The NZ-native payroll specialist
PayHero is built in Wellington and designed specifically for NZ payroll compliance. It doesn't do HR management, but its payroll engine is purpose-built for the Holidays Act, KiwiSaver, and ACC levies.
NZ pricing (excl. GST, source: payhero.co.nz/pricing, verified May 2026):
| Plan | Base fee/mo | Per employee/mo | Max employees |
|---|---|---|---|
| Origin | $19 | $4 | 10 |
| Super | $39 | $5 | Unlimited |
| Universe | $59 | $6 | Unlimited |
For a five-person business on the Origin plan: $19 + (5 × 4) = **39/mo NZD** excl. GST. That's the cheapest credible NZ payroll option for small teams.
The Super plan adds GPS clock-in, timesheet approvals, rest and meal break calculations (important for hospitality and retail), and phone support. Universe adds onboarding, document management, expenses, and API access.
PayHero billing is usage-based: you only pay for employees who appear in a pay run or timesheet that month. Seasonal staff who aren't paid in a given month don't count.
PayHero integrates with Xero, MYOB, and their own rostering product Droppah (free for up to 10 employees), which makes it solid for shift-based businesses like cafes, retail, and hospitality.
Tip
If you're under 10 employees and just need compliant payroll with leave automation, the Origin plan at $39/mo is hard to beat. You get Holidays Act calculations, public holiday automation, and branded payslips for less than a cup of coffee per employee per day.
Who it's for: Small businesses that want specialist NZ payroll compliance at a fair price. Especially good for hospitality, trades, retail, and any business with variable hours.
Where it falls short: No full HR module. If you want performance reviews, onboarding workflows, or a proper people-management platform, you'll need a separate tool.
Smartly: Managed payroll option for time-poor owners
Smartly takes a different approach. Their DIY payroll plan runs at around $51.50/mo platform fee + $10/employee/month + $2.60 per pay run (source: smartly.co.nz/plans snippet, verified May 2026). That's more expensive than PayHero for small teams.
Where Smartly differentiates is their managed payroll option, where Smartly's team runs your payroll for you. For businesses where the owner doesn't want to touch payroll at all, that's genuinely useful. Their Payroll One plan is also designed for businesses with just 1-2 employees (updated from July 2026 to $40/mo + $2/employee per pay period, per their support docs).
Smartly handles KiwiSaver, ACC levies, and Holidays Act calculations. Their UI is clean and their customer support is well-reviewed by NZ accountants.
Who it's for: Business owners who want to hand payroll off entirely. The managed option suits sole traders with a few staff, or owners who are already using an accountant and want the payroll completely handled.
Where it falls short: The DIY pricing isn't competitive for teams of 5-15 employees compared to PayHero. And there's no HR module.
Head-to-head: What a 5-person NZ business would pay
| Tool | Monthly cost (5 staff, NZD excl. GST) | Holidays Act compliant? | HR module? |
|---|---|---|---|
| PayHero Origin | $39 | Yes (NZ-native) | No |
| PayHero Super | $64 | Yes | No |
| Employment Hero HR Premium + Payroll Standard | $70 | Yes (AU/NZ adapted) | Yes |
| Smartly DIY | ~$103 + pay run fees | Yes | No |
| Employment Hero Payroll Standard only | $20 | Yes | No |
Employment Hero's payroll-only option at $4/employee/month is actually the cheapest on a per-employee basis, but most businesses buy it alongside the HR module.
iPayroll and MYOB: worth considering
Two others worth a mention:
iPayroll has been running NZ payroll since 2004. Pricing starts around $15/mo and it's well-established with NZ accountants. Good option if your accountant already recommends it. Less polished UI than the newer options.
MYOB Payroll is bundled with MYOB accounting products. If you're already on MYOB for your accounts, using their payroll module avoids double-handling. But MYOB's payroll has historically been clunkier than dedicated payroll tools.
Who should pick what
Under 10 employees, payroll only: PayHero Origin at $39/mo. It's NZ-native, compliant, and genuinely affordable. You won't find a credible NZ payroll tool cheaper.
10-50 employees, want HR and payroll together: Employment Hero on HR Premium + Payroll Standard. The per-employee cost is predictable, the HR features are genuinely useful at that size, and the Xero integration is clean.
Owner who doesn't want to do payroll themselves: Smartly's managed option. Pay the premium, hand it off, and focus on the business.
Hospitality, retail, trades with variable hours: PayHero Super. The timesheet approvals, GPS clock-in, and rest break calculations are built for exactly this.
The Holidays Act question
Worth being direct here: all three tools claim Holidays Act compliance, but the quality of implementation varies. PayHero was built with NZ compliance as the core product brief. Employment Hero's NZ payroll engine has been adapted from an AU base and is generally reliable, but some edge cases (like calculating leave for employees with highly variable hours) are worth testing before you commit.
If Holidays Act compliance is your primary concern, PayHero's local focus is a genuine advantage.
Integrations that matter for NZ businesses
All three integrate with Xero (the dominant NZ accounting tool). Employment Hero and PayHero both integrate with MYOB. If you're on Xero, any of the three will sync payroll journals automatically.
Employment Hero also connects to a wide range of HR tools, job boards, and learning management systems. PayHero connects to Droppah (rostering) and has an API for custom integrations.
Final verdict
For most NZ small businesses under 15 employees, the choice comes down to two options: PayHero if you want affordable, specialist payroll software with solid NZ compliance, or Employment Hero if you want a full people-management platform that handles hiring, contracts, onboarding, and payroll in one place.
Smartly makes sense if you'd rather pay someone else to run the payroll entirely.
Don't default to a global tool (QuickBooks Payroll, Gusto, Rippling) for a NZ team just because you've heard of them. NZ compliance requirements are specific enough that a tool built for NZ will save you remediation headaches down the line.
All prices are in NZD and exclude GST. Verify current pricing on each vendor's website before purchasing.