Free HR Software India 2026: What Is Actually Free (And What Is Not)

Free HR Software in India 2026: What Is Actually Free and What Is Not

"Free HR software" is one of the most searched phrases in the Indian HRMS market. It is also one of the most misleading product categories. Almost nothing that qualifies as a serious, India-compliant HR software is genuinely free at any meaningful scale.

This guide cuts through the confusion. We explain what free HR software in India actually offers, where the limits are, and whether there is a free option that works for your situation — or whether you should stop looking for free and start looking for affordable.

What "Free" Usually Means in Indian HR Software

Free Tier With Hard Employee Limits

Most HR software vendors that offer a free plan limit it to five or fewer employees. Zoho People's free tier covers up to five employees. Factorial's free plan (available in India) covers up to 10 employees with very limited payroll features. At five or ten employees, you are a very early-stage company and the free tier is a lead-generation tool for the vendor, not a sustainable solution.

Free Trial (Not Free Plan)

Many vendors offer a 14-day or 30-day free trial. This is not a free product — it is a time-limited evaluation. After the trial, you pay or you leave. Do not plan your operations around a trial account.

Free Core Features, Paid Compliance Features

Some products offer free HR features — employee database, leave tracking, basic attendance — but charge for the features you actually need for compliance: payroll processing, PF ECR generation, ESIC filing, TDS calculation. The free tier does the easy work; the compliance work that keeps you out of trouble costs money.

Freemium Products That Are Actually Loss Leaders

A few newer HR tools offer genuinely free access to attract users and monetise later through paid modules or services. These products are often funded by venture capital and may change their pricing at any time. Building your payroll workflow on a freemium product that changes its pricing model is an operational risk.

What Is Genuinely Available for Free

Zoho People — Free Up to 5 Employees

Zoho People's free plan includes: employee database, leave management, attendance tracking, and basic self-service. It does not include payroll processing, PF/ESIC/TDS compliance, or biometric integration. For a company with exactly five employees whose payroll is processed manually or through an accountant, this covers the HR side adequately. For anything beyond five employees or any compliance automation, the free plan is not sufficient.

Excel and Google Sheets — Free, But Not Software

Many Indian SMBs run HR on Excel. Monthly payroll in a spreadsheet, attendance in a sheet, leave records in another. This is genuinely free and it works — until it does not. Excel payroll breaks when compliance rules change (new PF ceiling, PT slab revision), when you hire the 20th employee and the sheet becomes unwieldy, or when the person who built the sheet leaves and no one else understands the formulas. The hidden cost of Excel HR is not the software — it is the errors and the compliance exposure.

Factorial — Free Up to 10 Employees

Factorial offers a free tier for small teams. The India-specific compliance features are limited in the free plan. Payroll processing and statutory filings require a paid plan. The free tier is useful for basic HR tracking for a very small team.

Why Free HR Software Cannot Handle Indian Compliance

Indian payroll compliance has a technical complexity that genuinely requires paid software to handle reliably:

PF ECR file generation: The EPFO portal requires an ECR file in a specific format. Generating this file from a salary spreadsheet requires either manual formatting or software that knows the format specification. Free tools that include ECR generation are rare because maintaining compliance with EPFO format updates requires ongoing development resources.

Multi-state professional tax: PT slabs vary by state and change at state budgets. Maintaining current PT slabs for all Indian states and applying them automatically requires a compliance database that costs money to maintain.

TDS under two tax regimes: Calculating TDS correctly for employees on both old and new tax regimes, with projected annual income recalculated when variable pay or investment declarations change, requires a payroll engine with significant logic. No free product does this reliably.

ESIC ECR and challan: Similar to PF ECR — the ESIC portal has format specifications that change, and generating correct challans requires maintaining the specification.

At What Point Should You Pay for HR Software?

10 or Fewer Employees, Simple Payroll

At this stage, Excel plus a good accountant is probably sufficient. The compliance risk is manageable, the payroll is simple enough to calculate manually, and the cost of even the cheapest HRMS may not be justified. Use Zoho People's free tier for HR tracking if you want software, and manage payroll through your accountant.

11–25 Employees

This is the transition zone. At 15–20 employees, your accountant is spending meaningful time on payroll each month, errors are becoming more frequent, and an ESIC registration is almost certainly required. The cost of a basic HRMS — ₹3,000–₹5,000/month — is typically recovered in accountant time savings and error reduction in the first two to three months.

26 Employees and Above

At this employee count, manual or accountant-managed payroll is not a sustainable model. PF ECR, ESIC challan, multi-state PT, and TDS for employees with different investment declarations require a payroll engine. The question is not whether to pay for software — it is which software to pay for.

The Most Affordable Compliant HRMS Options in India

If free is not viable for your compliance requirements, these are the most affordable options that handle the full Indian compliance stack:

PeopleVio — ₹3,750–₹5,000/month for 25 Employees

PeopleVio's pricing starts at approximately ₹150–₹200 per employee per month with no implementation fee and no minimum beyond your actual headcount. For a 25-employee company, the fully-loaded monthly cost is ₹3,750–₹5,000, including PF ECR generation, ESIC challan, multi-state PT, TDS for both regimes, biometric integration, and employee self-service. This is the lowest total cost of ownership for full-compliance payroll in India at the 10–50 employee range.

Zoho Payroll — ₹2,500–₹5,000/month for 25 Employees

Zoho Payroll is competitively priced and integrates with Zoho Books. The compliance depth for multi-state and complex payroll is less than PeopleVio, but for a company with employees in one or two states and a straightforward salary structure, Zoho Payroll is an affordable option.

Greythr — ₹4,500–₹7,000/month for 25 Employees

Greythr is priced slightly higher than PeopleVio for equivalent employee counts, with additional implementation fees in most cases. The compliance track record is strong.

Frequently Asked Questions

Is there any completely free payroll software in India with PF and ESIC?

No. As of 2026, there is no payroll software in India that handles PF ECR generation, ESIC challan, and TDS calculation completely for free at any meaningful employee count. The compliance maintenance required — keeping up with EPFO format changes, PT slab updates, Finance Act amendments — requires ongoing development resources that cannot be sustained on a zero-revenue model. If a product claims to be completely free with full Indian compliance, verify it against a live payroll run before relying on it.

Can I use free software for attendance and pay an accountant for payroll?

Yes, and many small Indian companies do exactly this. Zoho People's free tier for HR and attendance, combined with a chartered accountant handling monthly payroll, is a viable model for companies with up to 20–25 employees. The cost of a CA doing monthly payroll (₹3,000–₹8,000/month depending on employee count and city) is comparable to entry-level HRMS subscription pricing, but the HRMS provides better self-service for employees and better payslip management.

What is the cheapest way to handle compliant payroll for a 15-employee startup?

At 15 employees with a simple salary structure (single location, no ESIC, standard PT state), options in ascending cost order: (1) Excel template with manual challan filing — ₹0 software cost, but meaningful risk of errors; (2) Zoho Payroll — approximately ₹2,000–₹3,000/month; (3) PeopleVio — approximately ₹2,250–₹3,000/month. The difference between option 2 and 3 is negligible at this scale; the choice comes down to compliance depth needs and ecosystem fit.

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Evaluating your first HRMS? PeopleVio starts at ₹150 per employee per month with no implementation fee, no migration fee, and full compliance from day one. Ask for a pricing sheet and we will send it before any demo call.