Gusto pricing for a small service business
The plans
| Plan | Monthly billing | Per extra user | Includes |
|---|---|---|---|
| Simple Base rose from $40 to $49 on 1 March 2026 | $49/mo | $6/mo | per employee |
| Plus Adds multi-state payroll, next-day deposit, time tracking | $80/mo | $12/mo | per employee |
| Premium | $180/mo | $22/mo | per employee |
Checked 28 August 2026 against Gusto's pricing page (cross-checked across several pricing trackers, since the vendor page blocks automated access). Software pricing moves around, so confirm before you buy.
- Gusto regularly runs introductory discounts, so your first months may be lower than list price.
- Contractor-only payroll is priced separately and is cheaper than the W-2 plans.
What it costs at your size
Gusto Simple, which is the plan almost every business on this site should be on. Base fee plus $6 per employee, billed monthly.
| W-2 employees | Per month | Per year | Effective cost per employee |
|---|---|---|---|
| 1 | $55 | $660 | $55.00/mo |
| 2 | $61 | $732 | $30.50/mo |
| 3 | $67 | $804 | $22.33/mo |
| 5 | $79 | $948 | $15.80/mo |
| 8 | $97 | $1,164 | $12.13/mo |
| 10 | $109 | $1,308 | $10.90/mo |
Note the last column. The base fee dominates at small headcounts, so Gusto is proportionally most expensive for exactly the businesses this site is written for. At one employee you are paying $55 a month, of which $49 is just for the door.
The March 2026 increase
Gusto raised the Simple base fee from $40 to $49 on 1 March 2026, 22.5% on the base, with the $6 per-employee fee unchanged. If you are comparing against a guide written before then, its numbers are low.
Is it worth $55 a month for one employee?
The honest way to answer this is against the thing it replaces, not in the abstract.
| Option | Monthly cost | What you are actually buying |
|---|---|---|
| By hand | $0 | You keep the deadline risk. The IRS failure-to-deposit penalty runs 2% to 15% depending on how late you are. One missed deposit on a $1,500 liability can exceed a year of software. |
| Gusto Simple | $55 at 1 employee | Automatic federal and state filing, W-2s, new hire reporting, employee self-onboarding. |
| Bookkeeper runs it | ~$75–200 | A human who also knows your books. Slower for off-cycle runs. |
When we would not pay for it
- You have no W-2 employees. Contractor-only payments are cheaper on Gusto's separate contractor pricing, and may not need software at all.
- You already run QuickBooks and your accountant works inside it. Staying in one ecosystem is usually worth more than a few dollars a month. See Gusto vs QuickBooks Payroll.
- One salaried employee, fixed hours, no-income-tax state, organized owner. Rare, but real. Run it by hand and set two reminders per deposit date.
What we have not done
We have not yet run a full payroll cycle inside Gusto for a live business. Everything above is pricing analysis and comparison against documented alternatives, not a hands-on review, and we would rather say so than imply testing we have not done.
Common questions
How much does Gusto cost for one employee?
On the Simple plan the base fee is $49 a month plus $6 per employee, so a single W-2 employee costs $55 a month, or $660 a year. Checked 28 August 2026.
Did Gusto raise its prices in 2026?
Yes. The Simple plan base fee went from $40 to $49 a month on 1 March 2026, a 22.5% increase on the base. The per-employee fee stayed at $6.
Is the Simple plan enough for a small service business?
For most one-to-five employee businesses operating in a single state, yes. Simple covers full-service payroll with automatic federal and state tax filing, which is the part carrying legal deadlines. The main reason to move up to Plus is operating in more than one state, or wanting next-day direct deposit rather than a longer settlement window.
Is Gusto cheaper than a bookkeeper running payroll?
Usually, at this size. A bookkeeper running payroll typically charges $75 to $200 a month, against $55 to $79 for Gusto Simple at one to five employees. The bookkeeper may still be better value if they are already doing your books and payroll is bundled in.