In Hawaii, everything is a little bit more laid back. The sun’s out, the surf’s up, and life is good. That’s why you started a small business in The Aloha State. However, whether you own a surf shop in Honolulu or a bed & breakfast in Maui, there’s one thing that isn’t laid back whatsoever: payroll taxes.
We want you to focus on your business without having to worry about payroll taxes, so we’ve designed a nifty payroll calculator that can figure out all of the federal and Hawaii state payroll taxes for you and your employees. All you have to do is input wage and W-4 information for each employee into the calculator, and it will do the rest of the work for you.
First of all, let’s give Uncle Sam his due. Here’s a quick rundown of the components that go into federal tax withholdings. For a more detailed explanation on all of the steps below, head on over to our comprehensive step-by-step guide.
Only you as the employer are responsible for paying FUTA taxes, so you don’t need to withhold FUTA from your employees’ paychecks.
Now that we’re done with federal taxes, let’s look at Hawaii state income taxes. Hawaii charges a progressive income tax, broken down into a whopping 12 tax brackets, and they range from 1,4% on the low end to 11% on the high end. Employees who earn more than $200,000 a year will hit the highest tax bracket.
As an employer in Hawaii, you have to pay unemployment insurance to the state. The 2019 tax rates range from 0% to 5.6% on the first $46,800 in wages paid to each employee in a calendar year.
If you’re a new employer (congratulations!), you pay a flat rate of 2.4%.
In addition, you are responsible for paying what’s called the Employment and Training Assessment (E&T) Rate, which is 0.01%.
For the complete SUI tax rate schedule, head on over to the official State of Hawaii unemployment insurance website.
That’s all she wrote! You’ve checked it off your to-do list so you can move onto the important things. Once each employee’s net pay is calculated (after taking deductions and withholdings into consideration), you’re in the clear.
All you have to worry about is getting your employees paid on time as well as setting aside whatever you owe in FICA and unemployment taxes. Those numbers can add up quickly!
You will need to fill out Form 941 to file federal taxes on a quarterly basis, and Form 940 to report your annual FUTA liabilities. You can pay taxes online using the EFTPS payment system. All the IRS employment tax due dates can be found here.
As if that wasn’t enough, here are some helpful links that can if you would like to learn more about Hawaii payroll taxes: