Best Payroll Software Australia
Payroll in Australia carries compliance requirements that go well beyond calculating pay. Single Touch Payroll (STP) Phase 2, SuperStream, award interpretation under the Fair Work system, and state-based payroll tax obligations all need to be handled correctly for every client. For accounting firms offering payroll bureau services, the right software needs to manage these across a portfolio of clients from a single platform.
This guide covers payroll software suited for Australian accounting firms, focused on STP Phase 2 compliance, award automation, and multi-client payroll management.
Australian Payroll Compliance Baseline
Any payroll software used for Australian employees must handle:
- STP Phase 2: Disaggregated income reporting to the ATO — mandatory since January 2022. Covers salary/wages, allowances, deductions, and fringe benefits reported separately
- SuperStream: Electronic super fund payments and reporting through the SuperStream standard
- Award interpretation: Automatic calculation of Modern Award rates, penalty rates, overtime, and allowances under the Fair Work Act
- Payroll tax reporting: State-specific payroll tax thresholds and reporting (varies by state)
- PAYG withholding: Accurate ATO withholding calculations and annual payment summaries
- Leave management: Accurate accrual of annual leave, personal/carer’s leave, and long service leave per the National Employment Standards
| Platform | STP Phase 2 | Award Interpretation | Multi-Client | Best For |
|---|---|---|---|---|
| KeyPay | Yes | Automated | Yes (bureau) | Accounting firms offering payroll services |
| MYOB | Yes | Supported | Via MYOB Practice | MYOB-aligned firms |
| Xero | Yes | Basic (not full automation) | Via Xero HQ | Xero-aligned firms, simpler payrolls |
KeyPay
KeyPay is the strongest choice for accounting firms offering payroll bureau services in Australia. It was built specifically for multi-client payroll management and includes automated Modern Award interpretation — one of the most technically complex aspects of Australian payroll compliance.
Key Features
- STP Phase 2 compliant with full disaggregated income type reporting
- Automated Modern Award and Enterprise Agreement interpretation, including penalty rates, overtime, and allowances
- SuperStream compliant super payments integrated into the pay run workflow
- Multi-client bureau dashboard — manage payroll for all clients from a single login
- Employee self-service portal for timesheet submission, leave requests, and payslip access
- Leave accrual management per the National Employment Standards
- Integration with Xero, QuickBooks, and MYOB for automatic journal posting
Best For
Accounting firms that offer payroll bureau services as a practice line, particularly for clients in hospitality, retail, healthcare, and other award-heavy industries where automated award interpretation is critical. Also strong for firms wanting to manage all client payrolls from a single platform without logging into separate accounts.
MYOB
MYOB includes payroll within both MYOB Business (cloud) and AccountRight (desktop). For Australian clients, MYOB’s payroll handles STP Phase 2, SuperStream, and PAYG withholding with direct ATO reporting.
Key Features
- STP Phase 2 compliant payroll built into MYOB Business and AccountRight
- SuperStream compliant super payment processing
- PAYG withholding calculations and end-of-year income statement reporting
- Award rate support (manual setup required — not automated award interpretation)
- Payroll reports feeding directly into the accounting ledger
- ATO integration for payroll reporting through MYOB Practice
Best For
Australian firms with an established MYOB client base where payroll is managed within the same system as the general ledger. Well-suited for straightforward payrolls without complex award requirements. For award-heavy industries, MYOB’s payroll typically requires manual configuration of pay rules rather than automated interpretation.
Xero
Xero includes payroll as part of all Australian subscription plans. It is STP Phase 2 compliant and handles SuperStream, PAYG withholding, and standard leave accruals. Xero’s payroll integrates directly with the general ledger for automatic journal posting.
Key Features
- STP Phase 2 compliant with disaggregated income type reporting
- SuperStream compliant super payments
- PAYG withholding calculations and ATO annual income statement reporting
- Employee self-service via the Xero Me app
- Standard leave accrual management
- Direct posting of payroll journals to the Xero general ledger
Best For
Xero-aligned firms managing payroll for clients with relatively straightforward pay structures. For clients with complex Modern Award requirements or multiple pay conditions, pairing Xero with KeyPay — which integrates with Xero — is a common approach that gives firms KeyPay’s award engine with Xero handling the books.
Choosing Between Platforms
For accounting firms building a payroll bureau practice in Australia, the core question is whether your clients have complex award obligations:
- Award-intensive clients (hospitality, retail, healthcare, construction): KeyPay is the clearest choice, with automated Modern Award interpretation reducing manual configuration and error risk.
- Standard salaried payrolls: MYOB or Xero payroll handles straightforward pays within the existing accounting platform, reducing the need for a separate payroll tool.
- Mixed client base: KeyPay’s multi-client bureau dashboard makes it the most practical single platform for firms managing payroll across clients with different complexity levels.
For firms building their Australian tech stack more broadly, payroll software selection should be made alongside accounting platform choice — KeyPay integrates with both Xero and MYOB, giving flexibility without locking in to one accounting platform.