This report looks at data collected from outsourced payroll teams
IN-HOUSE
PAY PROFESSIONAL
OUTSOURCED PAYR LL INSIGHTS SURV Y REPORT 2026
This report looks at data collected from outsourced payroll teams
THINK PAY THINK CIPP
Part of the CIPP Payroll Insight Survey Report series including Pay Professional and In-house. See page 12 for links to the other reports.
PAYROLL INSIGHTS SURVEY 2026 OUTSOURCED
FOREWORD
Welcome to the Payroll Insights Report 2026. This report looks at data collected from outsourced payroll teams. Thank you to all who responded, and I hope this report provides some valuable insights into how such teams and functions are operated. The results can be used for benchmarking and helping organisations to review payroll operations and identify opportunities for improvement or highlighting where you are excelling. Please share this report with other pay professionals, colleagues and peers. It is important that we raise the profile of payroll as a profession and showcase the important work carried out by pay professionals across the UK.
CIPP Policy and Research Team
Contents
4 5 6 6 7 8 9
Payroll employees
Would you consider yourself a specialist payroll provider?
Payroll frequencies Working arrangements Qualification requirements
Pricing
Payroll cut offs Top challenges
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In most cases percentages have been rounded to two decimal places for clarity and may not add up to 100%. Graphics may have been rounded to whole percentages.
PAYROLL INSIGHTS SURVEY 2026 OUTSOURCED
One pay professional produced 890 payslips per month – 39% increase from 640 last year 1/890
30%
Access to payslips queries are most likely to be asked to the team. This is a change from tax code queries last year, although this was a close second ACCESS TO PAYSLIPS
of employers require or prefer payroll staff to hold a CIPP-approved qualification up from 23% last year
Hybrid is still the preferred working arrangement for payroll professionals HYBRID
100%
KEY TAKEAWAYS
of Bureaus within accountancy practices are registered for anti- money laundering (AML)
1/2
FOCUS ON LARGER, MORE SCALABLE OPERATIONS
BESPOKE PRICING PREFERRED
Specialist providers typically have fewer payrolls per payroll professional, but process
Outsourced providers still have half the cut off period of in-house teams
more than twice as many payslips (1,193 vs 567), suggesting a stronger focus on larger, more scalable payroll operations
Bespoke pricing packages were favoured at 54%, showing that payroll has become sufficiently varied that a single pricing model no longer suits most client relationships
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In most cases percentages have been rounded to two decimal places for clarity and may not add up to 100%. Graphics may have been rounded to whole percentages.
PAYROLL INSIGHTS SURVEY 2026 OUTSOURCED
RESULTS
Payroll employees
The median pay professional manages 48 clients and 60 payrolls , producing around 890 payslips per month, which is higher than in-house teams. Compared to last year, this represents 14% fewer payrolls and 31% fewer clients, but 39% more payslips per professional. This suggests that while bureaus are handling fewer payrolls overall, each one is larger and more complex. The increase in payslip volumes suggests payroll providers may increasingly rely on automation, standardisation and scalable systems to support efficiency. There is also significant variation across bureaus, with monthly payslips ranging from 65 to 100,000 , and client numbers from 4 to 3,000 , highlighting a wide diversity in size and capacity across the sector. 48 72 MEDIAN AVERAGE Clients per pay professional
39% more payslips per pay professional than last year
60
84
Payrolls per pay professional
MEDIAN
AVERAGE
890 MEDIAN
874 AVERAGE
Payslips (monthly) per pay professional
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In most cases percentages have been rounded to two decimal places for clarity and may not add up to 100%. Graphics may have been rounded to whole percentages.
PAYROLL INSIGHTS SURVEY 2026 OUTSOURCED
NEW
Would you consider yourself a specialist payroll provider?
Specialist payroll providers appear to operate a different business model to non-specialists. Specialist payroll bureaus handle fewer clients and payrolls, but deliver more than double the payslips per pay professional. This suggests specialists are focussed on servicing larger payrolls, where efficiency gains can be achieved through standardisation, expertise and process optimisation. In contrast, non-specialists appear to manage a greater volume of smaller and potentially more varied client relationships.
54% YES
46% NO
45
52
60
89
Clients per pay professional
Clients per pay professional
MEDIAN
MEDIAN
AVERAGE
AVERAGE
52
89
63
92
Payrolls per pay professional
Payrolls per pay professional
MEDIAN
MEDIAN
AVERAGE
AVERAGE
567 MEDIAN
586 AVERAGE
1193 MEDIAN
1121 AVERAGE
Payslips (monthly) per pay professional
Payslips (monthly) per pay professional
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In most cases percentages have been rounded to two decimal places for clarity and may not add up to 100%. Graphics may have been rounded to whole percentages.
PAYROLL INSIGHTS SURVEY 2026 OUTSOURCED
Payroll frequencies
Which pay frequencies do you operate?
62% of respondents worked within accountancy practices, where director-only payrolls typically form part of broader tax and accounting services. This likely explains the high proportion of annual payrolls reported.
100% MONTHLY
86% WEEKLY
ANNUAL 66% 64% FOUR-WEEKLY
56% FORTNIGHTLY
18% 8% QUARTERLY BI-ANNUAL
All respondents process monthly payrolls ( 100% ). Weekly payrolls continue to be widely supported at 86% . Annual payrolls were reported by a relatively high proportion of respondents. This may reflect the fact that 62% of respondents were part of an accountancy practice, where director-only payrolls can form part of wider tax and accounting service offerings.
Working arrangements
Hybrid working remains the dominant working arrangement again this year.
36% OFFICE- BASED
56% HYBRID
28% REMOTE
Hybrid arrangements are operated on a 3 / 2 split, but with slightly more choosing the office, averaging around three days per week in office and two remote days. The increase in hybrid working compared to previous years suggests outsourced providers continue to balance flexibility with the benefits of in-person collaboration in an office environment.
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In most cases percentages have been rounded to two decimal places for clarity and may not add up to 100%. Graphics may have been rounded to whole percentages.
PAYROLL INSIGHTS SURVEY 2026 OUTSOURCED
Qualification requirements
While requirements can vary depending on the job role, 30% of respondents require or prefer if the candidate has a CIPP-approved qualification. The majority of respondents, at 42% , have minimum education level requirements but 26% had no requirements at all. Nearly one-third of respondents either require or actively prefer candidates to hold a CIPP-approved qualification. This suggests professional qualifications are becoming increasingly important within outsourced payroll teams, particularly as providers face growing legislative complexity and increasing client expectations.
Do you have any qualification requirements for new payroll staff members?
Minimum education levels 42%
No requirements or preferences 26%
Prefer CIPP-approved qualification (e.g. Payroll Technician Certificate, Foundation Degree) 24%
Other (please specify) 22%
Require other industry qualification 10%
Require CIPP-approved qualification (e.g. Payroll Technician Certificate, Foundation Degree) 6%
No respondents selected that they ‘Prefer other industry qualification’ with 0%.
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In most cases percentages have been rounded to two decimal places for clarity and may not add up to 100%. Graphics may have been rounded to whole percentages.
PAYROLL INSIGHTS SURVEY 2026 OUTSOURCED
Pricing
Tasks most likely to be included as standard 1. Real time information (RTI) and employer payment summary ( 92% ) 2. End of tax year processing ( 88% ) 3. Leaver processing ( 88% )
The majority of bureaus use bespoke pricing ( 54%) followed by price per employee ( 38% ). Two respondents stated in the ‘other’ category that they used price based on time worked. Bespoke pricing remains the dominant charging model, used by more than half of respondents. This suggests payroll providers increasingly recognise that client requirements vary significantly in terms of complexity, payroll frequencies, integrations, benefits administration and compliance support. The results indicate that standardised pricing models may be becoming less suitable as payroll services become increasingly tailored to client requirements.
4. New starter processing ( 86% ) 5. Automatic enrolment ( 76% )
Tasks most likely to not be included 1. Right to work checks ( 88% ) 2. Telephone queries from the clients’ employees ( 46% ) 3. Forecasting ( 44% ) 4. Payment to HMRC ( 41% ) 5. Email queries from the clients’ employees ( 34% ) 2. Payments to employees ( 56% ) 3. Processing of benefits (50%) 4. Forecasting ( 44% ) 5. Payments to HM Revenue and Customs (HMRC) ( 41% ) Tasks most likely to incur additional charges 1. P11D reporting ( 78% )
54% Bespoke pricing packages
38% Price per employee
36% Price per payslip
34% Price per pay period
The data suggests a clear distinction between operational payroll processing and advisory or specialist services. Core payroll functions such as RTI submissions, starter processing and year-end activities are typically included within standard service packages. More specialist or labour-intensive activities, including P11D reporting, benefits processing and forecasting, are more likely to attract additional fees. This demonstrates how many providers differentiate between routine payroll administration and higher-value advisory services.
16% Other
0% of respondents said that they use a ‘Contingency (percentage of processed payrolls) pricing structure
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In most cases percentages have been rounded to two decimal places for clarity and may not add up to 100%. Graphics may have been rounded to whole percentages.
PAYROLL INSIGHTS SURVEY 2026 OUTSOURCED
Payroll cut offs
Key Performance Indicators (KPIs)
Outsourced providers give, on average, three days before payday to provide final input for payroll processing, and only two days for weekly and fortnightly. Where this differs significantly from in-house payroll is for monthly processing, as in-house teams gave on average seven days. Therefore, outsourced providers operate significantly shorter payroll cut off periods than in-house payroll teams, particularly for monthly payrolls.
No KPIs measured 8%
Other 8%
Queries resolved 35%
This reflects the need to receive, validate and process client- provided payroll information within compressed timeframes whilst still meeting payroll deadlines.
Client satisfaction 36%
Payslip errors client data error 38%
Payroll completed on time 73% Payroll errors after payment / worker impacted 46%
Payslip errors processing error 46%
Payroll errors before payment / no worker impact 46%
TOP 3 PAYROLL QUERIES
Service quality appears to be the primary focus of outsourced payroll performance measurement. Timely payroll completion is the most widely used KPI, closely followed by payroll accuracy and client satisfaction measures. Together, these metrics highlight that reliability, accuracy and client experience remain the core drivers of success within outsourced payroll operations. 8% of respondents did not use any KPIs at all. This is lower than the 11% it was last year, this could mean that businesses are being more aware of focus on performance indicators to retain clients and win new ones.
ACCESS TO PAYSLIPS
UNDERPAYMENT (LATE DATA RECEIVED)
TAX CODE QUERY
Other KPIs commented were keeping to clients’ schedules, quicker turnaround than expectation, number of payroll re-runs.
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In most cases percentages have been rounded to two decimal places for clarity and may not add up to 100%. Graphics may have been rounded to whole percentages.
PAYROLL INSIGHTS SURVEY 2026 OUTSOURCED
NEW
NEW
Is your outsourced payroll part of an accountancy practice?
Are you registered for Anti-Money Laundering (AML)?
Accountancy practice
100% YES
38% NO
62% YES
Payroll services (non-accountancy practice)
21% NO
THE MAJORITY OF PAYROLL BUREAUS THAT RESPONDED ARE PART OF A WIDER ACCOUNTANCY PRACTICE
79% YES
While AML compliance across the sector is strong, payroll providers who are not currently registered may need to review this ahead of the new requirements to ensure they are prepared.
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In most cases percentages have been rounded to two decimal places for clarity and may not add up to 100%. Graphics may have been rounded to whole percentages.
PAYROLL INSIGHTS SURVEY 2026 OUTSOURCED
Top challenges
Artificial intelligence
Complexity
Heavy workload Anti Money Laundering Benefits Legilation changes Payrolling benefits Costs Software change Statutory Sick Pay changes Client acquisition Fee budget Payroll cut offs Holday pay data Growth targets Compliance Billing increases Manual processes Deadline pressure Incomplete data
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In most cases percentages have been rounded to two decimal places for clarity and may not add up to 100%. Graphics may have been rounded to whole percentages.
PAYROLL INSIGHTS SURVEY 2026 OUTSOURCED
PAY PROFESSIONAL
OUTSOURCED
IN-HOUSE PAYR LL INSIGHTS SURV Y REPORT 2026
This report looks at data collected from in-house payroll teams
CHECK OUT THE OTHER REPORTS This report is part of a series of three payroll benchmarking surveys, exploring in-house operations, outsourced services, and the role of pay professionals. Together, they provide a comprehensive view of the payroll landscape across the UK. To gain the full picture, please explore the other reports in this series by clicking the links to the right.
THINK PAY THINK CIPP
Part of the CIPP Payroll Insight Survey Report series including Outsourced and Pay Professional. See page 13 for links to the other reports.
CLICK TO VIEW REPORT
OUTSOURCED
IN-HOUSE
PAY PROFESSIONALS PAYR LL INSIGHTS SURV Y REPORT 2026
This report looks at data collected from pay professionals
THINK PAY THINK CIPP
Part of the CIPP Payroll Insight Survey Report series including Outsourced and In-house. See page 14 for links to the other reports.
CLICK TO VIEW REPORT
12
In most cases percentages have been rounded to two decimal places for clarity and may not add up to 100%. Graphics may have been rounded to whole percentages.
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