Outsourcing payroll in Australia: bureau, offshore payroll officer or in-house?

Australian businesses outsource payroll in three ways: a payroll bureau paid per employee, a dedicated offshore payroll officer working in your own payroll software, or an in-house payroll officer. A bureau suits small, simple payrolls. An offshore payroll officer, paid about A$800–2,000 a month plus a recruitment or monthly fee, suits businesses with 30 or more staff, awards and timesheets.

Since 1 July 2026, Payday Super means employers must pay super with every pay run, so whichever option you choose has to keep up with every pay cycle. This guide compares the three options and explains what to keep in Australia.

What does outsourcing payroll actually cover?

Payroll is more than paying wages. A complete payroll function includes:

• collecting and checking timesheets, rosters and leave requests

• applying the right award rates, penalty rates and allowances

• processing pay runs and payslips

• reporting each pay run to the ATO through Single Touch Payroll (STP Phase 2)

• paying super for every pay run

• managing new starters, terminations and leave balances

• answering staff questions about their pay

When you compare options, check which of these are included. Some bureaus only process the pay run from the figures you send them, which leaves the timesheet checking and award interpretation with you. We explain the day-to-day work in more detail in what does a payroll officer do?

Option 1: a payroll bureau

A payroll bureau, or payroll service provider, runs your pay runs in its own systems or in yours, usually for a fee per employee per pay. Accounting firms often offer this to their clients as well.

• Suits: businesses with a small team, salaried staff and one or two simple awards.

• Strengths: no one to hire, cover when someone is on leave, and the fee scales with your headcount.

• Watch out for: cut-off times for changes, extra charges for terminations and off-cycle pays, and who is responsible when an award rate is applied wrongly. Ask what happens to your data if you leave.

Option 2: a dedicated offshore payroll officer

An offshore payroll officer is a full-time person in Sri Lanka or the Philippines who works only for your business, in your payroll software and your processes. You or your finance manager approve each pay run before it is paid.

• Suits: businesses with 30 or more staff, casual and shift workers, several awards, or a payroll that also needs timesheet, rostering and leave admin.

• Strengths: one person who learns your awards, staff and exceptions, with time left over for reconciliations, accounts payable or HR admin.

• Watch out for: you need a written payroll process, an Australian approver and controls over who can change bank details.

As a monthly salary guide, experienced payroll officers earn about A$800–1,150 a month in Sri Lanka and A$1,450–2,000 a month in the Philippines. Our fee is separate: $5,999 + GST once with our Ready for You plan, or $1,000 a month with no upfront fee on Managed for You. See the offshore payroll specialist page for skills, screening and FAQs.

Option 3: an in-house payroll officer

A local payroll officer sits in your office and knows your people. That’s valuable for complex enterprise agreements, sensitive staff conversations and businesses that run payroll for hundreds of employees.

The trade-off is cost and cover. On top of salary you pay super, payroll tax where it applies, workers compensation and leave, and you still need a backup when they are away. Our post on the true cost of hiring in 2026 shows how those on-costs add up.

How the three options compare

What Payday Super changes

From 1 July 2026, employers must pay super guarantee contributions within seven business days of each payday, instead of quarterly. That makes every pay run a super deadline.

For outsourcing, it means three things. First, the person running payroll needs to process super in the same cycle, not save it for the end of the quarter. Second, a bureau with fixed processing days needs to fit your pay frequency. Third, someone needs to check each super payment cleared, because a missed payment can no longer be fixed quietly before the quarter ends. An offshore payroll officer can own that checklist, with an Australian manager approving payments.

What to keep in Australia

Whichever option you choose, keep these with an Australian owner or manager:

• final approval of each pay run and super payment

• changes to employee bank details, confirmed by a call to the employee

• decisions on award coverage and disputed pay

• terminations and any conversation about underpayments

Splitting the work this way gives you the cost saving without losing control. The same split works for bookkeeping and accounts payable, which we cover in how to build an offshore finance team.

How to decide

• Fewer than 20 staff on simple pay? A bureau, or your bookkeeper, is usually enough.

• 30 or more staff, casuals or several awards? A dedicated offshore payroll officer gives you a payroll person for a fraction of a local salary, and time for other finance work.

• Hundreds of staff or an enterprise agreement? Keep a senior payroll lead in Australia and add offshore support under them.

Accounting firms that run payroll for clients can use the same model. See offshore staff for accounting firms.

Frequently asked questions

Is it legal to have payroll done offshore?

Yes. Australian payroll can be processed from overseas as long as you meet your obligations: correct pay, STP reporting, super and privacy. Keep approvals in Australia and limit access to what the role needs.

Which payroll software can an offshore payroll officer use?

Any cloud payroll software with Australian STP reporting, such as Xero Payroll, Employment Hero, MYOB or QuickBooks. They log in with their own user account and permissions.

Is an offshore payroll officer cheaper than a bureau?

For small payrolls, usually not. Once you have around 30 or more staff, frequent changes and other finance admin to fill the day, a dedicated person often costs less and does more.

How long does it take to hire one?

We usually present a shortlist and fill the role in 3–4 weeks. Book a free consultation to talk through your payroll.