Virginia Wage and Payroll Tax Facts
February 05, 2024
Having to comply with unique state taxes and wage laws can make processing payroll doubly daunting. Here’s everything you need to know about these rates and laws for the state of Virginia.
Select a state or federal tax guide
Virginia requires a minimum wage rate that is substantially higher than the rates required by the federal government. It also has a few reciprocal agreements with other states to provide tax relief for citizens who work and live in different states.
When it comes to processing payroll, Virginia-based organizations must handle the following taxes in addition to those required by the federal government:
- Personal Income (a.k.a. State Income Tax)
- State Unemployment Insurance (SUI)
The below information was last updated January 30, 2024. It is not intended as legal or tax advice.
Virginia Minimum Wage Rates
|
Wage Type |
Virginia Rates |
Federal Rates |
|
Minimum Wage |
$12.00 |
$7.25 |
|
Tipped Minimum Wage |
$2.13 |
$2.13 |
|
Actual Tip Credit |
$9.87 |
$5.12 |
Virginia State Income Tax (SIT) Rates
Virginia's SIT is progressive, meaning it adjusts based on the income level of the employee paying the tax:
|
Income Tax Bracket |
2024 Income Tax Rate |
|
$0 - $3,000 |
2.00% |
|
$3,000 - $5,000 |
$60 + 3.00% of excess over $3,000
|
|
$5,000 - $17,000 |
$120 + 5.00% of excess over $5,000 |
|
$17,000 or greater |
$720 + 5.75% of excess over $17,000 |
|
Additional Virginia SIT Details |
|
|
Valid Filing Statuses |
|
|
Exemptions |
|
|
Form W-4 |
Form VA-4 |
|
Reconciliation Frequency |
Annual |
Virginia State Unemployment Insurance (SUI) Rates
SUI provides unemployment benefits to eligible workers who are unemployed through no fault of their own (as determined by state law) and meet the state’s eligibility requirements.
|
Virginia SUI Tax Details |
|
|
Taxable Wage Base |
$8,000 |
|
Employee Subject to Tax |
No |
|
Rates for Experienced Employers |
0.1% - 6.2% |
|
Rates for New Employers |
2.5% |
|
Effective Period |
Calendar Year |
|
Voluntary Contributions Allowed |
No |
Virginia State Disability Insurance (SDI) Rates
SDI benefits are funded by employees through mandatory payroll deductions from each paycheck. Virginia, however, doesn't require employers to collect an SDI tax.
Miscellaneous Virginia Tax Information
Reciprocal Agreement(s)
Reciprocal agreements are when workers who live and work in different states are only required to pay taxes to the state where they live. Virginia currently has reciprocal agreements with the following states:
- Kentucky
- Maryland
- Pennsylvania
- Washington D.C.
- West Virginia
Employers should withhold income tax for the employee’s resident state, as their non-residency status should be declared on their submitted Form VA-4.
Paid Sick Leave (PSL)
The state of Virginia doesn’t require employers to collect PSL taxes, nor does the state have a program providing such leave to employees.
Paid Family and Medical Leave (PFML)
The state of Virginia doesn’t require employers to collect PFML taxes, nor does the state have a program providing such leave to employees.
Virginia Employer Registration
The agencies below can help with your state-based employer registration, including best practices, account numbers, and unemployment information. Contact the Department of Taxation for withholding tax topics and the Employment Commission for unemployment tax topics.
|
Registration Details |
Department of Taxation |
Employment Commission |
|
Phone |
(804) 367-8037 | (804) 786-7159 |
|
Online Registration |
Business Tax iReg Page | |
|
Registration Form |
Form R-1 | Form T-FC-27 |
|
Registration Instructions |
Online and paper registration options are available. Account numbers will be issued during the online process or in 2-4 weeks via mail. | Online and paper registration options are available. Account numbers will be issued during the online process or in 1-2 weeks via mail. |
|
Employer Self-Service Login |
Business Tax iFile Page | |
Additional Virginia Payroll Tax Resources
- Virginia Business One Stop
- Department of Taxation Business Registration Checklist
- Department of Taxation Business Registration Interactive Tutorial
This information is provided as a courtesy and may be updated at any time. It is not intended as legal or tax guidance. If you have questions or concerns, we encourage you to seek the advice of a qualified CPA, tax attorney, or advisor.
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