From the Grammy awards FAQ page:
What is the difference between Record Of The Year and Song Of The Year?
The Record Of Year category honors the artist and the producer(s), recording engineer(s) and/or mixer(s) if other than the artist. This category is for a commercially released single, or track from a current year's album. The Song Of The Year category recognizes a songwriter for a single or track that was first released or if it first achieved prominence during the eligibility year.