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Updated: September 15, 2023
Payroll taxes are an essential part of running your own small business just like crinkled leaves of fire are essential to a Connecticut fall, nutmeg for a kitchen in the suburbs, and boats for long days sailing along the coast. But while The Land of Steady Habits has ideal essentials, payroll taxes are far from ideal.
Luckily, we’re here to help. Just call us the Long Island Sound of payroll taxes, the people who will shine the light to guide you all the way home to write those paychecks. All you need to do to access that light is enter wage and W-4 information for each employee and our payroll tax calculator will calculate all the Connecticut and Federal payroll taxes for you.
First and foremost, let’s pay Uncle Sam. Our handy payroll calculator can help you figure out the federal payroll tax withholding for both your employees and your business.
Below is a quick 6-step overview of everything that goes into calculating the payroll tax for your employees. If you prefer to see a more detailed calculation, we created a step-by-step guide just for you.
Now that we’re done with federal income taxes, let’s tackle Connecticut state taxes. The State of Connecticut is on the high end of marginal income tax rates compared to the rest of the country. It’s a progressive income tax that ranges from 3% to 6.99%.
Connecticut does not have any local city taxes, so all of your employees will pay only the state income tax.
Workers’ compensation is mandated across most states, and it’s no different in Connecticut. Learn how policies work, how this type of coverage protects employees from workplace injuries and illnesses, and what employers should know in our guide to Connecticut workers’ compensation insurance.
As an employer, you’re responsible for paying SUI (remember, if you pay your state SUI in full and on time, you get a 90% tax credit on FUTA).
You need to withhold one half of one percent (0.5%) of each employee’s taxable wages up to the Social Security contribution base ($160,200 in 2023). Withholding from employees’ paychecks for the PFMLA began on Jan. 1, 2021, and benefits are paid to employees as of Jan. 1, 2022.
If all that wasn’t enough, and you want to learn more about Connecticut payroll taxes, here are a few websites we suggest you check out:
Department of Revenue Services: (860) 297-5962 | Withholding Information | Small Business Assistance | New Employer Information
Department of Labor: (800) 263-6000 | File Your Taxes Online | How To Register
Give yourself a high-five because you are now done! Once you’ve calculated your employees’ net pay by taking out the appropriate withholdings, you’re ready to cut their checks.
In addition to making sure your employees get paid on time, don’t forget to set aside the employer taxes your company is responsible for. Those FICA and FUTA and SUI payments can add up if you don’t remit them on a regular basis.
Use Form 941 to file federal taxes quarterly. Use Form 940 to report your annual FUTA tax. You can pay taxes online using the EFTPS payment system. Find out more about employment tax due dates.
Employers in Connecticut can confidently calculate their employees’ gross pay, net pay, and deductions using the calculator at the top of this page. But from time to time, employers may face situations that require a little more number crunching. For example, do you occasionally offer bonuses to your top-performing employees? Keep in mind that Uncle Sam considers this type of payment to be supplemental wages and requires taxes to be withheld. Additionally, sometimes employee turnover comes with the territory, and employers may have to figure out what a worker’s final paycheck will be. So, if you can use a little more help adding up the numbers, check out some of the calculators listed below.
Try OnPay out yourself to see how easy payroll and HR can be. To get started, just share a few basic details about your business. Our team of pros will set everything up and import your employees’ information for you.