Payroll Tax Calculator
Calculate employee payroll taxes, employer payroll taxes, net pay, and total payroll cost. Free calculator for small business owners, HR teams, and finance professionals.
Payroll Tax Calculator
Calculate employee payroll taxes, employer payroll taxes, net pay, and total payroll cost. Free calculator for small business owners, HR teams, and finance professionals.
Generated: 2/22/2026, 12:34:15 AM | AskSMB.io
Calculate Payroll Taxes
Input Values
Employee gross wages before taxes
How often the employee is paid
Income tax + employee-side payroll taxes
Employer-paid payroll taxes (e.g., Social Security, insurance)
Results per Period
Employee Payroll Taxes
$0
Total taxes withheld from employee pay
Employer Payroll Taxes
$0
Total payroll taxes paid by employer
Net Pay to Employee
$0
Take-home pay after employee taxes
Total Payroll Cost
$0
True cost of payroll to the employer
Payroll Cost Breakdown
Annual Projection
Payroll Cost Distribution
How the Payroll Tax Calculator Works
What are payroll taxes?
Payroll taxes are mandatory taxes on wages and salaries paid by both employers and employees. They fund social insurance programs like Social Security, Medicare, unemployment insurance, and other government services. Understanding payroll taxes is crucial for accurate budgeting and compliance.
Employee vs Employer Payroll Taxes
Employee taxes are withheld from paychecks and include federal/state income tax, Social Security (6.2%), and Medicare (1.45%). Employer taxes are paid on top of wages and include matching Social Security and Medicare contributions, plus federal and state unemployment taxes. These typically add 7-10% to total labor costs.
Why Payroll Taxes Matter for SMBs
For small businesses, payroll taxes significantly impact cash flow and profitability. The true cost of an employee is much higher than their gross salary. Accurate payroll tax calculation helps businesses budget correctly, avoid penalties, maintain compliance, and make informed hiring decisions.
Common Payroll Tax Components
- Social Security: 6.2% employee + 6.2% employer (up to wage base limit)
- Medicare: 1.45% employee + 1.45% employer (no limit)
- Federal Unemployment (FUTA): 0.6% employer-paid
- State Unemployment (SUTA): Varies by state (0.5-10%)
- Income Tax Withholding: Varies by employee (federal, state, local)
- Other: Disability, workers' comp, paid family leave (varies by state)
How to Reduce Payroll Tax Burden Legally
- Offer pre-tax benefits (401k, health insurance, HSA/FSA, commuter benefits)
- Classify workers correctly (W-2 employees vs 1099 contractors)
- Claim available tax credits (Work Opportunity Tax Credit, R&D credits)
- Optimize state unemployment rates through lower employee turnover
- Stay current on payments to avoid penalties and interest
- Consider geographic locations with lower tax burdens when hiring remote workers
Example Calculation
Frequently Asked Questions
Related Tools
💡 Quick Tips
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- •Results update in real-time as you type
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