Washington registration and tax info

Prior to issuing payments to employees, ensure that you've completed the payroll registration process in the relevant state of their employment. This might take a few weeks, so beginning early is advisable to acquire the necessary tax account details for payment purposes.

Niural collaborates with Middesk to assist you in the state registration process. For additional information, please explore the details provided below.

Let Niural register for you

Niural partners with Middesk to help you register your business in new states. 

How it works

On adding a new work address in a different state and recruiting a new employee who has been allocated a work address in that state, you can access registration support within Niural.

The pricing is subject to change based on the state. 

Here's an overview of the procedure:

1. Provide essential business details.

2. Niural and Middesk will verify the accuracy of the information.

3. Registration applications are normally sent within 3-5 business days.

4. Look out for registration details from Middesk in the mail. 

5. Middesk can guide you through entering any data they don't handle on your behalf through Niural.

Initiate the state tax registration process

• Sign in to Niural as an employer.
• Navigate to the Company tab.
• Select Tax setup.
• Under “[State name] Tax Setup”, click Let Niural register for you.

Note: Niural can only register for you if you don't yet have a state account already.

• Enter company information on Middesk. 
• Once you submit your order, we will send you email updates regarding the status. The total cost of your order will be added to your upcoming monthly invoice.
• Check the status of your order
• Once your order is finalized, you will receive emails from both Niural and Middesk. These emails will outline the subsequent actions, including:

1. Reviewing registration information.

2. Any additional state-specific instructions.

Before your order is finalized, you can use the link provided in the state registration confirmation email from Niural to track the progress of your order.

Cancel your order

If an order is already completed, you'll need to contact Middesk to cancel.

If an order is in progress you can email us at support@niural.com.

You'll be refunded, but it can take a few business days to process. 

 

Registering your company in the state of Washington

To register your company in the state of Washington, the steps vary based on your business structure:

For Sole Proprietorships and General Partnerships:

1. File a Business License Application with the Business Licensing Service.

For Corporations, Limited Partnerships, LLCs, and LLPs:

1. Create a business structure with the Office of the Secretary of State. Click on "Corporations and Charities Filing System (CCFS)" to register.

2. Once your business structure is established, file a Business License Application with the Business Licensing Service.

For Businesses Already Licensed but Hiring Employees for the First Time:

1. Refile a business license application with the Business Licensing Service.

2. The Department of Revenue will process your application and notify WA Labor & Industry (L&I) to open a workers' compensation account.

3. They will also notify the Employment Security Department (ESD) to open an unemployment insurance account.

4. You will receive a letter from your new Workers' Comp account manager and a packet of information, including:

• Unified Business Identification (UBI)
• ES (Employment Security) Reference Number
• Workers' Comp Account ID
• Participant Activation Code (PAC) for WA L&I 
  • (Note: PAC codes for Niural will be issued by Washington L&I.)
• State Unemployment and Employment Administration Fund rate

5. The letter and packet will be sent to you 10 days after registering online or within 6 weeks if registering by mail.

Entering the tax account information in Niural

Once a valid Washington work address has been added in Niural for one or more employee(s), you can add your tax account information:

1. Go to the Company details section in your Niural account.

2. Click on Jobs and Pay.

3. Select Edit on Washington Tax Setup.

4. Enter the following:

• ES Reference number
• Unified Business ID
• Workers' Comp Account ID
• Participation activation code
• When entering your State Unemployment Insurance (SUI) tax rate in Niural for Washington, make sure to exclude the EAF (Employment Administrative Fund) rate. However, include all other lines, such as the social cost, from the SUI rate notice when inputting your rate in Niural.

To update a tax account number after it has already been entered, please reach out to support@niural.com. It's important to note that there may be potential tax implications if taxes have already been paid or filed using an incorrect account number. 

Obtaining Workers' Compensation Insurance Risk Class Codes and Rates

Workers' Compensation insurance is crucial as it provides protection and coverage for your business against injuries and illnesses that may arise from work-related activities performed by your employees.

In Washington, employers are required to obtain this coverage through a state-operated fund. Niural will handle the payment of this insurance premium on your behalf to the state.

Here's how to proceed:

File Your Business License: Follow the instructions provided in the previous section to file your business license.

Access Your Workers' Comp Rates: After completing your business license filing, you can find the workers' compensation rates assigned to your business online.

Note: Risk class codes for Workers' Compensation are different from Standard Operational Classification (SOC) codes. Both codes are necessary for Washington employees, so make sure you have the correct information for compliance. 

Where to find your company's workers' comp rates

To obtain your company's assigned risk class code rates, follow these steps:

1. Visit the Washington State Department of Labor & Industries website.
2. Use the dropdown menu to search for your company by name, Workers' Comp account number, or WA UBI number..
3. Select your company name from the list of search results.
4. Click on the "Workers' Comp Rates" option.
5. Look for your agency-assigned Risk Classification, Composite Rate (Hourly Rate), and Employee Deduction (Employee Withholding).

Please note that Niural does not support class codes that use square footage as part of the tax calculation, such as in the drywall industry.

How to enter risk class codes and rate information in Niural

If an employee has multiple risk class codes, you'll need to assign them a job for each role/risk class code, and then edit the risk class code for each role using the instructions below. 

1. Go to the Team under the Payroll section.
2. Click on an employee’s name.
3. Navigate to the Job & Pay section and click Edit on Compensation details.
4. Locate the field “Risk Class Code” and select the appropriate risk class code from the list..
5. Click on Save.

Here are some examples of employees who may be exempt from Workers' Compensation coverage in Washington:

• Sole Proprietors, Partners, and Some LLCs Without Employees (Owners Only): Coverage is optional for these individuals.
• Self-Insured Employers: Private carrier coverage is not allowed for self-insured employers.
• Employees Based in Idaho, Montana, Nevada, North Dakota, Oregon, South Dakota, Utah, or Wyoming: Washington has reciprocal agreements with these states regarding the acceptance of workers' compensation coverage.
• Some Corporate Officers: Certain corporate officers may be exempt from mandatory coverage.
• Some For-Hire Vehicle/Drivers: Depending on specific circumstances, some for-hire vehicle drivers may be exempt.
• Some Maritime Workers: Certain maritime workers may be exempt from coverage.
• Some Contractors: Depending on the nature of their work, some contractors may be exempt.
• Most Volunteers: Volunteers are typically exempt from workers' compensation coverage.
• Some Trucking Contractors: Specific trucking contractors may qualify for exemptions.

It's important to note that the exemption status may vary based on individual circumstances and the type of work being performed. Employers should consult with the Washington State Department of Labor & Industries or legal counsel to determine the exact requirements and exemptions that apply to their specific situation.

Getting your unemployment tax rate

Finding your unemployment tax rate

To find your unemployment tax rate in Washington, follow these steps:

1. When you filed your business license application, you should have received a letter from your new Workers' Comp account manager and a packet of information. This packet typically includes your unemployment rate, which is based on your industry.
2. If you are unsure about your unemployment rate, you can contact the agency at (855) 829-9243, and choose option 3 for assistance.

Running payroll in Niural before you are been issued a company-specific unemployment rate

If you need to run payroll but have not yet received your company-specific unemployment rate, it is recommended that you add the "New employer SUI tax rate" specific to Washington in the interim. 

Entering the tax account information in Niural

Entering the tax account information in Niural

Once a valid Washington work address has been added in Niural for one or more employee(s), you can add your tax account information:

1. Go to the Company details section in your Niural account.

2. Click on Jobs and Pay.

3. Select Edit on Washington Tax Setup.

4. Enter the tax account information.

5. Click on Save

 

Setting up Paid Family Medical Leave (PFML) on Niural

Registering for Paid Family and Medical Leave

After obtaining your UBI account number from the state, the next step is to register for Paid Family and Medical Leave (PFML) in Washington. PFML is a program that provides partial wage replacement during leave for various purposes, including recovering from illness or injury, bonding with a new child, certain military events, or caring for a sick family member. Please note that PFML is distinct from the WA Cares Fund, effective from July 1, 2023.

Here's how to register for PFML online through your Secure Access Washington (SAW) portal:

If you don't have a SAW account, you can follow this tutorial to set one up.

Once you've established and logged into your SAW account, follow these steps to add your account to the Paid Family and Medical Leave system:

• Click on the "Add a New Service" button.
• Select "I would like to browse a list of services."
• From the list of organizations, choose "Employment Security Department."
• Locate "Paid Family and Medical Leave" and add it to your services by clicking the "Apply" link.
• Confirm the addition on the confirmation screen and click "OK."
• Return to the SAW homepage and find "Paid Family and Medical Leave" under your services. Click to access it and create your PFML account.
• Select "Continue" to enter the Paid Family and Medical Leave portal.
• You'll be prompted to create an account. Go to "Employer Accounts" and click "Create an Account."
• Enter your 9-digit UBI (Unified Business Number) number. If you're unsure about this number, you can contact the Department of Revenue. You might receive an error indicating that the UBI is not found; in that case, select "Create Employer."
• You'll be directed to a form where you must provide necessary business information. After entering your address and clicking "Next," you'll need to upload supporting documentation, which can be either:

1. The Master Business Application (from the Department of Revenue) or

2. The business's Articles of Incorporation (from the Washington Secretary of State).

Washington's compliance team will review your request and add the UBI number to their system. If additional information is required, the agency will contact you using the contact details you provided on the application.

 

Employee premiums

Niural automatically withholds and pays the employee premiums for this tax. Employers have the flexibility to choose whether they want to cover some or all of their employees' PFML deductions.

Employer premiums

For Employers that have less than 50 employees

Companies with fewer than 50 employees are exempt from paying the employer premium. However, they are still required to collect and remit the employee premium. Employers in this category have the option to assist their employees by covering some or all of the PFML deductions.

While these companies can opt to pay the employer premiums to qualify for WA ESD's small business grants, please note that this feature is not supported in Niural. For more information on this, refer to the WA PFML website.

Employers that have over 50 employees

Employers with 50 or more employees are obligated to pay the employer premium. Niural can handle the payment of the employer premium on your behalf, provided you have informed us that you are subject to this tax in your Niural account. If no action is taken, we will not make employer contributions on your behalf.

 

Note: If you are subject to the employer premium, you must update your Niural account annually by March 31 to ensure compliance.

Letting Niural know if you're subject to PFML

1. Navigate to Company details under the Company tab.
2. Click on Edit on the Washington Tax Setup
3. Select “Yes” on the Required to pay employer portion of WA Paid Family and Medical Leave.
4. Click on Save.

Covering a percentage of your employees' PFML deductions

Please keep in mind the following important details:

• These settings will apply to all employees in the state.
• The settings will become effective in the quarter following the one in which edits are made. For example, if you make an edit in July (during Q3), the company will start covering employee deductions starting October 1 (beginning of Q4).
• In the interim, you can issue non-taxable reimbursements at the end of the quarter to repay all or a part of the amounts deducted from employees.
• These settings exclusively apply to PFML deductions in Washington.

Next, set the percentage of employee-deductions for PFML that you'd like to cover:

1. Click the Company Details under the Company tab.
2. Navigate to Jobs and Pay.
3. Click on Edit under Washington State Taxes. 
4. On the PFML employee portion field, enter the percentage you’d like to cover. 
5. Click on Save. 

Premium calculations and other PFML resources

The total premium amount due for each tax year can fluctuate, with the maximum limit being up to the Social Security wage base. This total comprises contributions from both employees and companies. For the most current rate information, please refer to the Premium Calculator.

 

To find additional information about Washington Paid Family and Medical Leave (WA PFML), you can explore the following resources:

• WA PFML Agency Site: Visit the official Washington Paid Family and Medical Leave agency website for comprehensive information on the program.
• Employer-Specific Info: For details tailored to employers' needs and responsibilities under WA PFML, you can check specific employer-related information provided by the agency.
• To report PFML Outside of Niural: If you need to report PFML outside of Niural or require additional guidance, you can refer to the agency's resources or contact them directly for assistance.

Finding account numbers and rate info (For companies that are already registered)

If you have previously registered your business in the state, it's essential to enter your tax account details into Niural for payroll processing. To enable Niural to file and pay taxes on your behalf, you must be registered with one or more of the following agencies:

1. Washington Department of Revenue - for your business license.
2. Washington State Department of Labor and Industries (L&I) - for worker's compensation.
3. Washington Employment Security Department (ESD) - for unemployment tax and Paid Family and Medical Leave.

If you haven't yet registered with these agencies, you can refer to the relevant dropdowns provided in this article to initiate the registration process. Completing these registrations will ensure compliance and enable seamless payroll processing with Niural.

Finding your UBI and ESD tax account numbers

To find your Unified Business Identifier (UBI) number in Washington, follow these steps:

1. Visit the Department of Revenue website.
2. Look for the "I want to..." section, and click on "Look up a business."
3. Enter your company name in the search field.
4. Click "Search."

Your UBI number should appear in the search results. UBI numbers in Washington typically start with the digit "6."

Employment Security Department (ESD) account numbers

If you've previously run payroll in Washington and need to find your Employment Security Department (ESD) account numbers, you can refer to the following sources:

1. Quarterly Tax and Wage Detail Reports (Form 5208 A): Your ESD account numbers can typically be found on these reports.
2. Annual Tax Rate Notice: Both your ESD account number and your Unified Business Identifier (UBI) number can be located on your annual tax rate notice from the Employment Security Department.

To find your unemployment rate, follow these steps:

1. Review the notice you receive annually from the Washington Employment Security Department.
2. Alternatively, you can contact the agency at (855) 829-9243 to inquire about your unemployment rate.

When entering your unemployment rate in Niural, do not include the Employment Administrative Fund (EAF) rate. Instead, include all other lines, such as the social cost, from the State Unemployment Insurance (SUI) rate notice.

To obtain your Department of Labor and Industries (L&I) account number, Participant Activation Code (PAC), and workers' compensation rates, it is generally required to have Third Party Authorization (TPA). You may need to contact the agency or follow their specific procedures to obtain this information.

WA L&I account number

You can find your account number by logging into your WA L&I account. 

To find your Department of Labor and Industries (L&I) account number in Washington, follow these steps:

1. Log in to your WA L&I (Washington Labor and Industries) account.
2. Please note that the WA L&I agency is separate from the WA Employment Security Department.

Once you have obtained your Washington L&I account number, you can enter it into Niural. After entering your L&I account number, Niural will generate a third-party authorization (TPA) form that you will need to sign. This TPA form is typically required to establish the necessary authorization for Niural to interact with the L&I agency on your behalf.

Required: Signing the TPA form in Niural

Obtaining the necessary third-party authorization (TPA) is essential for Niural to file your tax returns with WA L&I (Washington Department of Labor and Industries). If you are transitioning to Niural from another payroll provider, you will need to transfer the TPA to Niural. Here's how to do it:

1. Navigate to the "Company" section in Niural.
2. Select "Documents."
3. Locate and e-sign the relevant WA authorization form for third-party authorization. This step will grant Niural the necessary authorization to file your tax returns with WA L&I on your behalf.

Participation Activation Code (PAC)

Employers are provided with a Participation Activation Code (PAC) for their Workers' Compensation Insurance. You can locate your PAC in two specific documents:

New Account Letter: You can find your PAC on the "new account letter" related to your Workers' Comp Insurance.

Annual Rate Notice: The PAC can also be found on your "annual rate notice."

The PAC number typically consists of 3 to 8 digits. If you are unsure about your PAC number or cannot locate it, you can contact the Washington L&I (Labor and Industries) agency at (360) 902-4817 for assistance. They will be able to provide you with the necessary information.

 

WA CARES long-term care fund

The WA CARES long-term care fund, effective from checks dated July 1, 2023, onwards, will involve the collection of WA CARES premiums by Niural from employees, a process similar to what is already done for PFML. The purpose of the WA CARES fund is to provide Washingtonians with access to long-term care when they require it. Here's a brief overview of how it operates:

 

Premiums: Washington workers will contribute up to $0.58 per $100 of their earnings towards this fund. It's important to note that this contribution is made by employees, and employers do not contribute.

 

Benefits: Starting from July 2026, individuals who are eligible for the benefit can access long-term care services worth up to $36,500 (adjusted annually for inflation) over the course of their lifetime.

 

Eligibility: To qualify for the benefit, individuals must meet specific contribution requirements and require assistance with daily living activities.

 

Self-Employed: If you are self-employed, you have the option to voluntarily participate in the program and secure affordable WA CARES Fund benefits for yourself.

 

Who needs to register?

If you're already registered for Paid Family Medical Leave (PFML) in Washington and have a "UBI" number, there is no need for you to go through the registration process again. The Washington Employment Security Department (ESD) is currently in the process of enhancing their PFML platform to encompass WA CARES as well.

 

Here are the requirements for WA CARES:

1. Employer Contribution: Employers do not contribute to WA CARES. The entire burden of premiums is borne by employees. These premiums are deducted from employees' paychecks at a rate of 0.58% per $100 of their earnings.
2. Premium Limit: As of now, there is no upper limit (wage base limit) on the premiums. This means that the 0.58% premium rate applies to all eligible earnings without any maximum income threshold.
3. Employee Premium Collection: Businesses are responsible for collecting WA CARES premiums from employees whose work is localized in Washington. They are also required to report their employees' wages and hours. Typically, the same group of employees who pay PFML premiums will also contribute to WA CARES, and the employer will handle premium collection and reporting for both programs for these employees.

 

Exemptions from WA CARES participation are available, but they come with specific conditions. Here's an overview of the exemption process:

 

1. Employee Application: Eligible employees have the option to apply for an exemption. If their request is approved, they are required to provide the exemption approval letter issued by the Washington Employment Security Department (ESD) to all of their current and future employers.
2. Permanent Ineligibility: Employees who receive approval for exemptions are permanently disqualified from participating in the WA CARES program.
3. Employer-Provided Long-Term Care Insurance: Even if a company already offers long-term care insurance to its employees, the company cannot request exemptions on behalf of its employees. The decision to seek an exemption or use WA CARES to complement existing benefits is solely at the discretion of individual employees.
4. Employee Choice: Employees have the freedom to decide whether they want to pursue an exemption from WA CARES coverage or if they prefer to utilize WA CARES as a way to enhance the benefits already provided by their employer.

 

Part-time employees and living out of state

All full-time and part-time employees are eligible to participate in the WA CARES program unless they have been granted an approved exemption. There are certain conditions, besides residing out of state, that can make someone working in Washington eligible for an exemption from WA CARES.

 

One important distinction between the WA CARES program and PFML (Paid Family Medical Leave) is the type of care they cover:

 

• WA CARES (Long-Term Care): WA CARES focuses on long-term care needs, which involve assistance with daily activities such as bathing, eating, dressing, medication management, and help with tasks in the bathroom. Long-term care is distinct from medical care and is not typically covered by standard health insurance or PFML.

 

• PFML (Paid Family Medical Leave): PFML, on the other hand, is designed to provide paid leave to eligible employees for certain qualifying events, such as a serious medical condition, the birth or adoption of a child, or caring for a family member with a serious health condition. It addresses short-term medical and family care needs and is not specifically tailored to long-term care assistance.

 

In summary, WA CARES focuses on long-term care assistance, while PFML addresses a broader range of short-term medical and family caregiving needs.

Here are the resources and information related to WA CARES reporting and corporate officers in Washington:

WA CARES Resources:

• FAQs: Frequently Asked Questions related to WA CARES.
• Employer Information: Information and guidelines for employers participating in the WA CARES program.
• Toolkit for Employers: A set of tools and resources to assist employers with WA CARES compliance.
• Reporting Corporate Officers: Guidance on reporting corporate officers and their earnings in compliance with Washington state requirements.
• Reporting Corporate Officers in Washington: If your company is a corporation operating in Washington, it is necessary to report corporate officers who are not covered by unemployment insurance (exempt) and provide details of their in-state taxable wages in the quarterly reports submitted for unemployment insurance.
• Quarterly Reporting Process: At the conclusion of each quarter, Niural will prompt you to complete a specific task on your Home page to ensure compliance with this reporting requirement. You will encounter two questions in this process: Number of Corporate Officers: Indicate the total count of corporate officers who are exempt from unemployment insurance coverage.
• Officer Earnings and Stock Options: Report the earnings and any stock options associated with these corporate officers.
• Report corporate officers and officer earnings: If your company operates as a corporation in Washington, it is mandatory to include in your quarterly reports for unemployment insurance all corporate officers who are exempt from unemployment insurance coverage, along with their respective in-state taxable wages. This reporting requirement ensures compliance with the state's regulations regarding unemployment insurance coverage for corporate officers.
• At the end of each quarter Niural will ask you to complete a to-do item on your Home page so we can comply with this requirement. Below are the two questions you will see: 

1. Number of corporate officers: #
2. Officer earnings and stock options: $

Corporate officers and officer earnings

Corporate officers, in the context of reporting for Washington state unemployment tax, refer to all officers of a corporation, including those who may not be listed in the Niural system, and who meet the criteria for exemption from Washington state unemployment tax. These officers are not already included in the regular quarterly Washington UI Tax and Wage Report.

Officer earnings represent the total wages or earnings combined for all corporate officers who are not covered by Washington state unemployment tax.

For detailed information on how to define a corporate officer and the specific regulations regarding unemployment insurance coverage for corporate officers in Washington, it is advisable to visit the official website of the Washington State Employment Security Department (ESD). Additionally, you can contact the ESD directly at (855) 829-9243 for further assistance and clarification on this matter.

Amending filings from the past

If there have been previous errors in reporting the number of corporate officers or their earnings on any of your quarterly reports, you can correct this by following the instructions provided below:

• Send an email to uifiles@esd.wa.gov. In your email, include the following information:
• Specify the quarter that requires correction (e.g., Q1 2017).
• Provide the accurate count of corporate officers.
• Include the correct total for officer earnings and stock options for that specific quarter.
• Make it clear in your email that you are requesting an amendment specifically for the corporate officer section of the filing.

To ensure that your correction request is processed promptly, you may also consider following up with the Employment Security Department's accounting unit directly at employeraccounts@esd.wa.edu.

 

Seattle Payroll Expense tax

Beginning on January 1, 2021, and continuing through December 31, 2040, businesses operating within the city of Seattle may be subject to a payroll expense tax. Please find more information below:

Niural's Position:

Niural does not currently support this tax, but we will keep a close eye on its impact on our customers and reevaluate our stance in the coming years.

Key Details for 2023:

• Employer-Paid Tax: This tax is paid by employers and is based on the "payroll expense" of the business, which refers to the compensation paid to employees working within Seattle.
• No Employee Withholding: Employers are explicitly prohibited from withholding this tax from their employees. It is solely the responsibility of the employer to pay it.
• Business Responsibility: The payroll expense tax is levied on businesses, not on individual employees. This means that the tax is paid directly by the employer, and there is no withholding of this tax from employee salaries.
• Filing Requirements: Businesses that had a total Seattle payroll expense of $8,135,746 or more in 2022 and have at least one employee with an annual compensation of $174,337 or more in 2023 are obligated to file a payroll expense tax return.

This information provides an overview of the payroll expense tax applicable in Seattle for the year 2023. It is essential for affected businesses to stay informed about their obligations and any updates related to this tax.

Determining the $7 Million Threshold for Payroll Expense Tax

1. Look Back to the Prior Year:

For example, if you want to assess whether your company is subject to the tax in 2021, examine the compensation paid to Seattle employees in the prior year, which would be 2020, to determine if it exceeds $7 million in payroll expenses.

2. Calculate Compensation Paid:

Calculate the total compensation paid to Seattle employees during the specified prior year. Include all forms of compensation that are relevant for the payroll expense tax calculation.

3. Exceeding the Threshold:

If the total compensation paid to Seattle employees in the prior year exceeds $7 million, your company meets the threshold for the payroll expense tax.

4. Assess Current Year Tax Liability:

Once you have determined that your company is subject to the tax for the current year based on the prior year's data, you will need to use the current year's compensation data to calculate the actual payroll expense tax due for that year.

5. Apply Tax Rates:

Refer to the provided tax rates or guidelines to determine how the tax should be applied based on the current year's compensation and the specific criteria outlined in the tax regulations.

For instance, businesses that had $7 million or more in Seattle payroll expenses in 2020 would apply the tax rates specified in the applicable table to their 2021 Seattle payroll expenses for employees with annual compensation of $150,000 or more.

How do I calculate the businesses total compensation paid to Seattle employees?

Calculating Total Compensation for Seattle Employees

To determine the total compensation paid to Seattle employees for the purpose of the payroll expense tax, follow these guidelines:

Inclusions - Compensation calculations should include:

Standard gross compensation paid to the Seattle employee.

All payments made for personal services.

Commissions and bonuses paid to the employee.

The cash value of all earnings paid in any form other than cash.

Employee contributions to deferred compensation plans (e.g., 401(k), 403(b), or other deferred compensation plans) in which a portion of an employee's salary or wages is set aside to be paid at a later date.

Exclusions - Compensation does not include:

Tips received by the employee.

Supplemental benefit payments made by an employer to an employee in addition to any paid family or medical leave benefits received by the employee.

Employee-exercised stock options, including incentive stock options (ISOs) or non-qualified stock options (NQSOs).

Payments provided to cover a past or future cost incurred by the employee as a result of their expected job functions.

Employer contributions into retirement or disability plans.

Payments to an owner of a pass-through entity that are not earned for services rendered or work performed (e.g., return of capital, investment income, or other passive activities).

For assistance in finding annual compensation totals for Seattle employees, you can create a customized report in Niural by following the instructions provided in the associated article. This report will aid in accurately determining the compensation subject to the payroll expense tax.

 

What rates are used for the Seattle Payroll Expense tax?

The table below is based on the total Seattle payroll expense subject to the tax.

Payroll expense tax due dates—calendar years 2021 and 2022

Calendar Year 2021:

All quarterly amounts for 2021 should be consolidated and reported on the Q4 2021 reports.

Due Date: January 31, 2022.

Calendar Year 2022:

For the quarter ending March 31, 2022.

Due Date: April 30, 2022.

For the quarter ending June 30, 2022.

Due Date: July 31, 2022.

For the quarter ending September 30, 2022.

Due Date: October 31, 2022.

For the quarter ending December 31, 2022.

Due Date: January 31, 2023.

How to file and pay the Seattle Payroll Expense tax 

To ensure compliance with Seattle's business tax requirements, follow these steps:

1. Register for a Seattle Business License Tax Certificate:

If you haven't already, complete the registration process to obtain a Seattle Business License Tax Certificate. This certificate is mandatory for all businesses operating in Seattle.

2. Seek Additional Information:

For comprehensive details and further insights into the Seattle Business License Tax, refer to the provided resource.

3. Manual Registration and Filing (If Preferred):

If you prefer manual registration and filing, you can download Payroll Expense Tax forms from the website.

Fill out the manual forms and send them to the address indicated on the form's reverse side.

Keep in mind that your returns will only be considered filed once both the tax filing and payment have been received.

4. Opt for Online Registration and Filing (Recommended):

We recommend using the City of Seattle's online tax portal, FileLocal, for registration and tax filing.

To access this portal, you'll need your unique "customer number" assigned to your business during registration. This number can be found on your business license tax certificate.

Utilize your "customer number" to securely file your taxes and make payments online.

5. Provide Information on Manual Forms:

If you opt for manual filing, ensure that you include your customer number, legal business name, and address on the field forms.

6. Contact for Assistance:

If you encounter any questions or require assistance at any point during this process, don't hesitate to get in touch with the agency directly:

Phone: (877) 693-4435

Email: FileLocal@avenuinsights.com

 

2023 updates for the Payroll Expense tax

1. Review Seattle Department of Finance and Administrative Services Updates:

Check out the 2023 Payroll Expense tax updates provided by the Seattle Department of Finance and Administrative Services. These updates may contain important information and changes related to the tax.

2. Forms Filed in Washington:

Identify the specific forms you need for your Washington tax filings. These may include:

• Employer's Quarterly Tax and Wage Detail Report
• Labor & Industries Employer's Quarterly Report
• Employer's Paid Family & Medical Leave Quarterly Wages and Hour Report
• New Hire Report

3. Accessing Forms in Your Account:

Go to the "Taxes & compliance" section in your account and select "Tax documents."

Use the tabs available on the page to switch between federal, state, W-2, and 1099 forms as needed.

4. Note About Asterisk (*) Information:

Some filings marked with an asterisk (*) will not appear in your "Tax documents" tab. These might include coupons, payment vouchers, or other forms that are filed electronically.

5. Confirm Tax Payments:

 

To verify that tax payments have been successfully made, you can generate an agency payments report.

6. Agency Contact Information:

Here are the contact details for relevant agencies in Washington:

• Washington State Employment Security Department: Phone - (855) 829-9243
• Washington Labor and Industries (L&I): Phone - (360) 902-5800
• Washington Paid Family and Medical Leave: Phone - (833) 717-2273