Nanny payroll service vs. an hours tracker
Short answer: they solve different halves of the same problem. A payroll service takes a number of hours and turns it into a compliant payment — withholding, direct deposit, agency filings, a W-2. An hours tracker produces that number in the first place, and answers the question payroll never touches: what do I still owe this person right now? If you're a household employer above the annual wage threshold, you need payroll. If you're below it — a sitter, a tutor, a part-time cleaner — a tracker is the whole answer. With a full-time nanny on variable hours, you want both.
Two different jobs
| Household payroll service | Hours & pay tracker (e.g. Paypr) | |
|---|---|---|
| Core question answered | "Is this paid legally?" | "What do I owe, right now?" |
| Records daily hours | You enter totals per pay period | Yes — logged as they happen, on a phone |
| Running balance owed | No | Yes |
| Partial & cash payments | Outside the system | Recorded and netted off |
| Withholds employee taxes | Yes | No |
| Remits & files with agencies | Yes — federal and state | No |
| Issues a W-2 / Schedule H figures | Yes | No |
| Moves the money | Yes — direct deposit | No |
| Multiple people | Usually priced per employee | Unlimited on one Pro plan |
| Works for a self-employed cleaner or tutor | No — they're not your employee | Yes |
| Setup | EIN, state registration, employee forms | Add a person and a rate |
| Typical cost | Recurring monthly or quarterly fee | Free for 1 person; $2.99/mo or $7.99 lifetime (Paypr) |
When you need a payroll service
You need one when you're a household employer with a real filing obligation — that is, when the person is your employee (you control the schedule and how the work is done) and cash wages to them for the year cross the annual threshold, a figure a little under $3,000 in recent years. There's also a separate, lower FUTA trigger at $1,000 in any calendar quarter.
At that point you owe Social Security and Medicare taxes, probably state unemployment, a W-2 in January and Schedule H with your return. You can do all of it yourself; families mostly don't, because the deadlines are quarterly, the state registration is fiddly, and the penalties for a missed filing exceed the annual cost of the service. Paying someone to handle it is a rational trade — see the providers listed in best household payroll apps.
A tracker cannot substitute for this. If you're above the threshold, no amount of tidy record-keeping discharges the obligation.
When a tracker is all you need
Most households paying for help are not household employers, and for them payroll is a subscription to filings they don't owe. A tracker is the right and complete tool when:
- You're under the threshold — a Friday-night sitter, a tutor for two hours a week, a fortnightly cleaner.
- The person is genuinely self-employed — own business, own equipment, many clients. They handle their own taxes, and households generally don't even issue a 1099 for personal services (detail here).
- The babysitter is under 18, which is often excluded from household employment tax outright.
- You pay several different people small amounts — a tracker holds them all; payroll would charge per employee.
In every one of those cases the actual problem is the same: variable hours, cash and app payments, partial settlements, and no reliable answer to "what's the balance?" That's what a tracker fixes.
Why plenty of families need both
The full-time-nanny case is the interesting one. Payroll handles the filings, but it starts from a number of hours you have to supply — and if those hours vary, something has to capture them accurately before payday. A payroll dashboard is not what you open in the hallway at 6:40pm when the nanny leaves 40 minutes late.
So the workflow that actually holds up is: log hours in a tracker daily → read the weekly total (including anything over 40, which is time-and-a-half) → enter that into payroll → payroll withholds, pays and files. The tracker also gives you the wage-and-hour record that employers are expected to keep, which payroll doesn't reconstruct for you.
Where Paypr fits — plainly
Paypr is a tracker. It holds each person's hourly rate, logs hours in a couple of taps, records payments (full, partial, cash), keeps an always-current balance, shows weekly/monthly/yearly summaries, and exports a per-person CSV for the year. It has a contractor view for people on the other side of the arrangement, and records stay on your device, syncing through your own private iCloud.
Paypr does not withhold taxes, remit to agencies, file returns, issue W-2s, or move money. If you're a household employer, it belongs alongside a payroll service, not instead of one. If you're not, it's likely all you need — and it's free for one person.
Get the hours right, whichever route you take
Paypr keeps hours, payments and a running balance for every nanny, sitter, tutor or cleaner — and exports clean records for payroll or your accountant. Track one person free, forever.
Download Paypr on the App StoreThird-party services are described from their own public materials and are not affiliated with Paypr. Features and pricing change — verify with each provider.
Related:
Best household payroll apps · Nanny taxes explained · Nanny tax calculator · How to track what you owe
Frequently asked
Do I need a nanny payroll service or just an hours tracker?
Use a payroll service if the nanny is your employee and you will pay them more than the annual household-employment threshold in cash wages — it withholds their taxes, remits to federal and state agencies, files the returns and issues a W-2. Use an hours tracker if you are below the threshold or the person is self-employed, since there are no filings to make and what you actually need is an accurate log of hours, payments and the balance owed. Families with a full-time nanny on variable hours usually run both: the tracker produces the hours, the payroll service acts on them.
Can an hours tracker replace a nanny payroll service?
No. If you have a filing obligation, only payroll (or doing the filings yourself) discharges it — good records do not. A tracker replaces the spreadsheet, not the payroll service. What it does do is make payroll easier and more accurate, because the hours you enter are logged daily rather than reconstructed at the end of the pay period.
Is Paypr a payroll app?
No. Paypr tracks hours worked, rates, payments and the running balance for each person you pay, and exports the year as a CSV. It does not withhold tax, remit to agencies, file returns, issue W-2s, or transfer money. It is the record layer that payroll and tax filings depend on, and for households below the household-employment threshold it is generally all that is needed.
How much does household payroll cost compared with a tracker?
Household payroll services charge a recurring monthly or quarterly fee, typically priced per employee and varying by state and by how much registration and filing is included — check current pricing with each provider. A tracker is far cheaper: Paypr is free for one person, and Paypr Pro is $2.99 a month after a 7-day free trial or $7.99 once for lifetime, covering unlimited people. The comparison only matters if you actually owe the filings a payroll service performs.
Do I need payroll for a tutor or a house cleaner?
Usually no. Tutors and cleaners with several clients, their own schedule and their own equipment are generally self-employed, so they handle their own taxes and you file nothing — households do not normally issue a 1099 for personal household services. If instead you set the hours and direct the work, they may be your household employee, and the same threshold rules that apply to a nanny apply to them.
General information, not tax or legal advice. Household-employment thresholds, wage rules and overtime rules change annually and vary by state — confirm the current rules with the IRS, the US Department of Labor, your state labor agency, or a qualified professional.