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Covers Virginia employer payroll requirements, including graduated state income tax withholding, unemployment insurance contributions and new hire reporting. Also notes state labor rules such as the Virginia Overtime Wage Act and the state retirement savings program.
Virginia employers must withhold state income tax at graduated rates of 2% to 5.75%, pay state unemployment insurance on the first $8,000 of each employee's wages, and report new hires within 20 days.
Last updated in source: 09/19/2025.
Virginia has a graduated individual income tax (four brackets) with rates ranging from 2% to 5.75%. Employers in Virginia must withhold state income tax, pay state unemployment insurance (SUI) contributions, comply with the Virginia Overtime Wage Act and other state labor laws, and follow state new-hire reporting rules. The Commonwealth also operates a state-facilitated retirement savings program (RetirePath Virginia) for certain private-sector employees and employers.
Virginia uses a graduated personal income tax with marginal rates of 2%, 3%, 5% and 5.75%; the top rate applies to taxable income over $17,000 under the standard schedule. Beginning with tax year 2025 (returns filed in 2026) the Virginia standard deduction increased, including for single filers. See the Virginia Department of Taxation for tables and the legislative summary.
Employers who pay wages to employees in Virginia must register for and withhold Virginia income tax per Virginia Department of Taxation guidance.
Employers must report newly hired or rehired employees — and, in many cases, certain independent contractors — within 20 days of the hire or rehire date to the Virginia New Hire Reporting Center, per state statute.
Virginia has implemented RetirePath Virginia, a state-facilitated IRA/auto-enrollment savings program, for certain private employers who do not offer a qualified retirement plan. Employers that meet the statutory criteria (size/eligibility thresholds and no qualified plan) may be required to register or otherwise offer access to RetirePath. Employees are generally automatically enrolled, but participation is voluntary and employees may opt out.
Public employers have separate retirement systems, for example the Virginia Retirement System (VRS). Consult the Commonwealth Savers / RetirePath guidance for registration, payroll deduction setup and employer responsibilities.
Virginia does not have a municipal or local personal income tax withheld from wages; withholding is at the state level. Municipalities do impose business/professional/occupational license (BPOL) taxes, business personal property taxes, and local sales and meal taxes. These are local business taxes, not payroll withholding for personal income. Always check the locality where the employee works for business license or BPOL rules.
Virginia law requires employers to provide paid sick leave accrual of at least 1 hour for every 30 hours worked, with carryover and annual caps; an employer may set higher limits. The statute defines permitted uses, including employee illness, medical care, preventive care, family care, domestic violence and public health emergencies. Employers must follow the statutory accrual, use, carryover and notice/posting requirements unless they choose a more generous policy. See Code of Virginia, Article 2.1.
Note: verify whether your workplace meets any excluded employer definitions or industry-specific rules, and ensure your handbook and payroll accrual logic reflect Virginia's required accrual and carryover rules.
Virginia Overtime Wage Act (VOWA): Virginia has a state overtime statute that largely aligns with — and in some enforcement and claims aspects supplements — the federal Fair Labor Standards Act. Non-exempt employees are entitled to time-and-one-half for hours worked over 40 in a workweek. VOWA provides for enforcement via the state and may affect damages and recovery. Employers must apply the strictest applicable law, state or federal, and correctly classify exemptions (executive, administrative, professional, outside sales and certain computer employees).
Tipped employees: Virginia recognizes the FLSA tip-credit framework. Employers may pay a lower cash wage to tipped employees provided total wages plus tips meet the state minimum wage. The Commonwealth's minimum wage applies as a total-earnings floor. Virginia Department of Labor and Industry (DOLI) guidance and federal FLSA rules apply for tip credits, disclosures and tip-pooling.
There is no broad state law requiring private-sector employers to provide paid meal breaks or rest breaks beyond what federal law requires. However, short breaks — typically around 20 minutes — that are provided are compensable under the FLSA. Follow industry-specific rules where applicable and document your policies.
Virginia law requires hourly/nonexempt employees to be paid at least every two weeks (or twice a month); salaried employees generally must be paid monthly at a minimum, with exceptions. Final pay timing on termination or resignation is governed by state rules — follow the Code of Virginia and DOLI guidance for exact timing and required statements.
Employers must follow Virginia wage-assignment and garnishment statutes and federal garnishment rules for child support, tax levies and court orders. Voluntary payroll deductions require proper written employee authorization. See the Code of Virginia and the Department of Taxation / DOLI for forms and processes.
Employers must maintain payroll, time, tax and benefit records consistent with the FLSA and Virginia law. Post required Virginia DOLI notices (minimum wage, paid sick leave summaries if applicable), wage notices and other mandated postings. Ensure state new-hire and withholding registrations are current.
Virginia uses a graduated individual income tax with four brackets and marginal rates of 2%, 3%, 5% and 5.75%, with the top rate applying to taxable income over $17,000 under the standard schedule. Employers who pay wages to employees in Virginia must register for and withhold Virginia income tax.
Virginia's state taxable wage base is $8,000, used for computing employer UC charges. Base tax rates vary by employer experience, with typical published ranges of about 0.1% to 6.2%, and new employers receive an initial assigned rate until they are experience-rated.
Employers must report newly hired or rehired employees, and in many cases certain independent contractors, to the Virginia New Hire Reporting Center within 20 days of the hire or rehire date.
Virginia law requires paid sick leave accrual of at least 1 hour for every 30 hours worked, with carryover and annual caps that an employer may set higher. Permitted uses include employee illness, medical care, preventive care, family care, domestic violence and public health emergencies.
No. Virginia has no municipal or local personal income tax withheld from wages; withholding happens at the state level only. Municipalities do impose business taxes such as business/professional/occupational license (BPOL) taxes and business personal property taxes, which are not payroll withholding.