What Are Payroll Taxes?
Payroll tax generally refers to two different kinds of similar taxes.
The first kind is a tax that employers are required to withhold from employee' wages, also known as withholding tax, pay-as-you-earn tax (PAYE), or pay-as-you-go tax (PAYG) and often covering advance payment of income tax and social security contributions.
The second kind is a tax that is paid from the employer's own funds and that is directly related to employing a worker, which can consist of a fixed charge or be proportionally linked to an employee's pay. The charges paid by the employer usually cover the employer's funding of the social security system.
The information contained herein is general in nature and is not intended, and should not be construed, as legal, accounting or tax advice.The reader should contact his or her tax professional prior to taking any action based upon this information.
The first kind is a tax that employers are required to withhold from employee' wages, also known as withholding tax, pay-as-you-earn tax (PAYE), or pay-as-you-go tax (PAYG) and often covering advance payment of income tax and social security contributions.
The second kind is a tax that is paid from the employer's own funds and that is directly related to employing a worker, which can consist of a fixed charge or be proportionally linked to an employee's pay. The charges paid by the employer usually cover the employer's funding of the social security system.
The information contained herein is general in nature and is not intended, and should not be construed, as legal, accounting or tax advice.The reader should contact his or her tax professional prior to taking any action based upon this information.