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Pennsylvania Payroll Tax Rates for 2017

December 13, 2016 | posted by Abacus Payroll
2017 pennsylvania payroll tax

Here is a summary of all the changes to Pennsylvania payroll tax rates in 2017. We keep this page updated, but if you’d like to be alerted to more changes to Pennsylvania Payroll Tax rates in future, you can subscribe to our Payroll Tax Alert Service.

If you’d like help with your payroll tax, we’d be happy to give you a quote. You’ll be assigned your very own payroll tax expert and our prices start at $4 per employee per month.


Pennsylvania Income Tax Rate

The withholding rate for 2017 remains at 3.07%


Pennsylvania Unemployment Tax

The employee rate for 2017 is 0.07%. Wages subject to unemployment contributions for employees are unlimited. Wages subject to unemployment contributions for employers increase to $9,750.


Effective January 1, 2017 employers are required to pay unemployment compensation (UC) contributions and reimbursement Statement of Accounts electronically if the total liability owed equals or exceeds $5,000 for a payment period.


FREE Paycheck and Tax Calculators


City of Philadelphia Wage Tax

Effective July 1, 2016 tax rates are 3.9004% for Philadelphia residents and 3.4741% for nonresidents. These rates are adjusted by the City of Philadelphia on July 1, of each year.


Pennsylvania Local Tax Rate

Act 32 is a law that reformed and standardized the local earned income tax (EIT) system, which requires uniform withholding of earned income taxes and local services tax with remittance to a single local collector or Tax Officer. For more information, see


New From Abacus Payroll: An HR Help Center


New Hire Reporting Requirements

All employers in the state of Pennsylvania are required to report basic information about employees who are newly hired, rehired and returning to work after separation of employment or leave of absence, temporary employees, and contracted entities. Employers must report this information within 20 days via the internet at Failure to report a new employee could result in a fine up to $25 per violation. New employers should receive instruction booklets upon registration with the state. Basic employee information which must be provided is as follows:


(1) Employee’s name

(2) Employee’s address

(3) Employee’s social security number

(4) Employee’s date of hire and birth

(5) Employer’s name and address

(6) Employer’s federal identification number


For further information contact us or call the State of Pennsylvania at 1-888-724-4737


2017 Wage Tax Rate Summary for Pennsylvania

2017 Current Year 2016 Prior Year
Minimum Wage $7.25 $7.25


Maximum taxable earnings $9,750 $9,500
Employee deduction 0.07% 0.07%


2017 Wage Tax Rates for the City of Philadelphia

2017 Current Year 2016 Prior Year
City Wage Tax
Residents 3.9004% 3.9102%
Non-Residents 3.4741% 3.4828%

View more rates on our Federal Payroll Tax Update page.

Print 2017 Payroll Tax alert


View our End-of-Year Payroll Checklist


About the Author: Abacus Payroll

Abacus Payroll, Inc. is a leading provider of payroll solutions for businesses of all sizes. Whether yours is a family-owned small business or a national corporation, we provide payroll, tax and other financial services on time and at an affordable price. Unlike other payroll providers, Abacus Payroll will assign your very own payroll specialist who will understand your payroll needs inside and out. So no more speaking to a different person each time, no more sitting on hold for hours and most importantly no more missed deadlines! Contact us today to see how we can help your business. You can count on us.