Payroll Done Right

Virginia Payroll Requirements: What Employers Need to Know in 2026

Virginia's state income tax runs from 2% to 5.75%. The brackets are compressed: 2% on the first $3,000, 3% on $3,001–$5,000, 5% on $5,001–$17,000, and 5.75% on income above $17,000. Most Virginia employees earning more than $17,000 annually are effectively in the 5.75% bracket on all but the first $17,000 of income. Employers use the Virginia Department of Taxation withholding tables. Employees complete Form VA-4 to set their withholding exemptions—Virginia has its own form and doesn't use the federal W-4 for state withholding. Quarterly or monthly withholding returns (Form VA-5) are due based on your average monthly withholding amount. Annual W-2 reconciliation (Form VA-6) is due January 31.

Virginia's minimum wage increased to $12.00/hr on January 1, 2025. A further increase is planned, but the path to $15.00/hr has been subject to ongoing legislative review. As of 2026, $12.00/hr is the current state floor, and any additional scheduled increases depend on affirmative legislative action each year. Employers in northern Virginia near the DC metro area should note that D.C. and Maryland have higher minimum wages—if you have employees who work across the border, you'll need to comply with the applicable rate for the state where the work is performed. Tipped employees in Virginia can be paid $2.13/hr, but the employer must cover any gap to reach $12.00/hr.

Unemployment insurance is managed by the Virginia Employment Commission (VEC). The SUI taxable wage base for 2026 is $8,000 per employee. New employer rates are 2.52% for most industries. Experience-rated employers range from 0.10% to 6.20%. Quarterly SUI returns are due April 30, July 31, October 31, and January 31. Employers register with the VEC before their first payroll. Virginia also requires new hire reporting to the Virginia New Hire Reporting Center within 20 days of the hire date.

Virginia doesn't have a state disability insurance program or a mandatory paid family and medical leave law as of 2026. A PFML proposal has been discussed in the General Assembly, but nothing has been enacted yet. One thing Virginia employers must keep current on: the state regularly updates its standard deduction amounts and personal exemption allowances, which affect Form VA-4 calculations. When an employee files a new VA-4, double-check that your software is applying the current values.

Federal obligations are standard: FICA at 7.65% each side, Social Security base of $176,100, FUTA net 0.6%, Form 941 quarterly, and W-2s by January 31, 2027. Virginia requires that W-2s be filed electronically with the Department of Taxation if you're filing 10 or more forms. The filing deadline through Virginia's iFile system is January 31. Employers must file copies of W-2s issued to Virginia residents who have Virginia withholding.

More detail in our guides on Virginia payroll taxes, 2026 SUI rates, and minimum wage and scheduled changes.