©2023 OnPay, Inc.
Insurance offered through OnPay Insurance Agency, LLC (CA License #0L29422)
Updated: January 6, 2023
Maple syrup, apple pie, and a whole lot of ice cream. Many of us would say they’re all the food groups we need! Vermont is a very special place. That’s why you started a small business here. And whether you strive to grow as big as Ben & Jerry’s or prefer to keep your small business small, there is one thing that you and all the other small business owners can agree upon: you’d rather dig into a pint of Chunky Monkey than worry about payroll taxes.
We couldn’t agree more, so we went ahead and designed a nifty payroll calculator that can figure out all of the federal and Vermont 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.
Check out your states payroll taxes below
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, we invite you to head on over to our comprehensive step-by-step guide.
Now that we’re done with federal payroll taxes, let’s look at Vermont state income taxes. Vermont charges a progressive income tax, broken down into four tax brackets. The 2023 tax rates range from 3.35% on the low end to 8.75% on the high end. Employees who make $204,001 or more will hit the highest tax bracket.
There are no local taxes, so all of your employees will pay the same state income tax no matter where they live.
As an employer in Vermont, you have to pay unemployment insurance to the state. The 2023 rates range from 0.8% to 6.5% on the first $13,500 in wages paid to each employee in a calendar year.
If you’re a new employer (congratulations on getting started!), rates range from 1% to 4.8% depending on your industry.
Remember to pay in full and on time so that you can get a FUTA tax credit!
Time to dig in! You’ve checked it off your to-do list so you can focus on growing your business. Once each employee’s net pay is calculated (after taking deductions and withholdings into consideration), you’re good to go.
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.
If you would like to learn more, here are some helpful links that we think can be useful:
Vermont Department of Labor (802) 828-4000 | Register Your Business | Unemployment Insurance
Vermont Department of Taxes (802) 828-2505 | Withholding Tax | Tax Forms
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.