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Home>Running Payroll

Two-Day Payroll

Two-day payroll helps you get your team paid faster. This feature allows you to either submit payroll up to two business days from your team’s pay date or get your team paid up to two days early, depending on when you want to submit payroll for processing. With this flexibility, two-day payroll gives you more time to run payroll and off-cycle payments.

Two-Day Payroll Application

To get started with two-day payroll:

  1. Sign in to Staff > Payroll > Settings in your online Square Dashboard.

  2. Select Pay schedule. Under the Running payroll section, next to Deadline to run payroll, click Change or Choose deadline.

  3. Follow the application prompts to provide the requested information.

  4. Click Submit.

Note: Applications are only reviewed after you send your first W-2 pay run. Your first pay run needs to be processed on the four business day window. Once you’ve sent your first run, we’ll review your application within two business days.

Running Payroll & Updating Your Pay Schedule

Employee pay day is five business days after the end of the pay period. To pay your employees on time with two-day payroll, you must submit payroll by 8 PM PT two business days in advance of the pay date.

Two-day payroll processing in two different scenarios:

  • If your pay period ends on Sunday and your employees are to be paid the following Friday, you must submit payroll by 8 PM PT on Wednesday for your employees to receive their pay on time.

  • Alternatively, if your pay period ends on Sunday and your employees are to be paid by the following Friday, you can submit payroll by 8 p.m. PT on Monday for your employees to receive their pay Wednesday of that week.

If payroll is processed after 8 PM PT on the third business day after the end of the pay period, employees will receive pay two business days after payroll is processed.

To submit a two-day payroll run:

  1. Log in to your online Square Dashboard and select Payroll.

  2. Click Run Payroll. On the first page, within the Schedule Payment section, select the preferred speed for payroll processing.

    1. If you’re running payroll ahead of your due date for submission, you can select the Fastest available option, which will get direct deposit payments to your team two business days from the day you submit payroll for processing.

    2. Select Regular pay day to have direct deposit payments scheduled on your regular cadence.

    3. Select Manual payments to issue physical checks to your team. Square Payroll will not issue checks on your behalf.

  3. Enter your team’s payroll details information or select Import time and wages > Continue.

  4. If applicable, add reimbursements > Continue.

  5. On the final Confirm Withdrawal page, review your payroll run details and ensure that your two-day payroll pay date is accurate. Select Confirm Withdrawal to submit your payroll run for processing. You’ll receive a confirmation of your team’s pay date and that your payroll debits have been initiated.

If needed, you are able to change your pay schedule from your Payroll account as well:

  1. Sign in to Staff > Payroll in your online Square Dashboard.

  2. Select Settings > Pay schedule.

  3. Fill out your pay period details, such as pay frequency, pay period duration, and payroll deadline.

  4. Click Save once you are done making changes.

Read more about the Square Payroll’s payment schedule.

Off-Cycle and Contractor Payments

For off-cycle and contractor payments, your team members will receive pay two business days after you submit the payment.

Square Payroll Holiday Pay Outs

Square Payroll’s pay dates are only affected by bank holidays if the pay date itself is scheduled on a holiday or if the holiday occurs in between the cut off time for processing and the pay date.

If a bank holiday occurs one business day prior to your pay date, payroll must be processed one business day earlier.

If a bank holiday falls on a scheduled pay date, the pay date will be moved one business day earlier and therefore payroll must be processed one business day earlier.

Direct Deposit Limit

If you are approved for two-day payroll, you will be provided a direct deposit limit. You can find your two-day payroll limit from Settings > Pay schedule in the Payroll section of your dashboard.

The direct deposit limit applies to the amount we debit from your bank account to pay out employees via direct deposit (net pay for direct deposits). After a payment has been submitted, your available limit will be reduced by the total net pay for direct deposit from that run until the business day following that payment’s pay date. If you need to send a run with an amount that exceeds your remaining available limit, the payment method for your team members will be converted to manual check.

An example of a business running payroll with a $10,000 direct deposit limit and a pay period that ends on a Friday, Saturday or Sunday:

  • Submit payroll on Monday, Tuesday or Wednesday for a Friday pay date.

  • Assuming the run’s total direct deposit amount was $7,000, the available direct deposit limit would become $3,000 ($10,000 - $7,000) until the following Monday, one business day following the pay date.

  • On Monday, the direct deposit limit will be increased by $7,000, leaving an available limit of $10,000.

An example of a business sending an off-cycle payment with a $10,000 direct deposit limit:

  • Submit off-cycle payment on Monday with a Wednesday pay date.

  • Assuming the run’s total direct deposit amount was $7,000, the available direct deposit limit would become $3,000 ($10,000 - $7,000) until the following Thursday, one business day following the pay date.

  • On Thursday, the direct deposit limit will be increased by $7,000, leaving an available limit of $10,000.

If your limit is not high enough for your needs, please contact us and we are happy to re-evaluate it. You may need to provide additional information.

Debit Failures

In the event a debit of your bank account is unsuccessful, we reserve the right to disable two-day payroll, which will result in employees receiving their pay 4 business days after processing payroll.

If you have additional questions on Square Payroll’s pay dates and payout schedule, contact us.

Denied Application

If your application for two-day payroll is denied, you can re-apply to have the feature enabled on your account 6 months from the initial application date.

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