Last reviewed: July 2026
New Virginia employers must: (1) obtain a federal EIN from the IRS, (2) register for a state tax account with the Virginia Department of Taxation for income tax withholding, (3) register for an SUI account with the Virginia Employment Commission, and (4) obtain workers' compensation insurance. Complete all registrations before running your first payroll.
Table of Contents
When you hire your first employee in Virginia, you trigger a series of registration requirements at the federal and state level. Missing any of these steps can result in penalties, delayed payroll, and compliance headaches. This guide walks you through everything, in order.
Registration Overview
Here's a checklist of what every new Virginia employer needs:
- ☑ Federal Employer Identification Number (EIN)
- ☑ Virginia state tax registration (Virginia Department of Taxation)
- ☑ Virginia SUI account (Virginia Employment Commission)
- ☑ Workers' compensation insurance
- ☑ New hire reporting setup
- ☑ Payroll system or software
Step 1: Get Your Federal EIN
Your Employer Identification Number (EIN) is your federal tax ID. You need it for federal tax filings, state registrations, opening a business bank account, and running payroll.
Apply online at IRS.gov/EIN. It's free and you receive your EIN immediately.
Step 2: Register with Virginia Department of Taxation
Visit the Virginia Department of Taxation website to register for a state employer tax account. This allows you to withhold Virginia state income tax from employee paychecks and remit it to the state.
From the Payroll Desk
Don't wait until your first payroll to register. State registrations can take days or weeks to process. Start the registration process as soon as you know you'll be hiring.
Step 3: Register for SUI
Register for a State Unemployment Insurance account through the Virginia Employment Commission. You'll be assigned:
- An employer account number
- Your initial SUI rate (2.5% for new employers, on the first $8,000 of each employee's wages)
- Quarterly filing requirements
SUI is an employer-paid tax, meaning you do not deduct it from paychecks. See our Virginia SUI Rates 2026 guide for a full rate breakdown.
Step 4: Workers’ Compensation Insurance
Virginia requires workers' compensation coverage once you have more than two employees, whether they work full time, part time, or seasonally. There are no waivers once you cross that threshold, so plan for it before you make your third hire.
You can obtain workers' comp through most commercial insurance carriers licensed in Virginia. Rates vary by industry classification, so it is worth comparing quotes if your work involves any physical labor.
Starting a Business?
If you are still setting up your legal entity, see our guide to forming an LLC in Virginia for the filing steps and state fees.
Step 5: New Hire Reporting
Federal and Virginia law require you to report every new hire within 20 days of their start date. Reports go to the Virginia New Hire Reporting Center and are used to enforce child support orders and prevent unemployment fraud.
See our New Hire Reporting guide for the federal side of this requirement, or our Form 941 guide for how new-hire withholding flows into your quarterly federal filing.
Step 6: Set Up Payroll
With all registrations complete, you are ready to run payroll. Two of our tools can help on the employee side: our paycheck calculator shows an employee what their take-home pay will look like, and our W-4 helper walks new hires through federal withholding elections before their first check.
For the tax deposit and filing side, payroll software that already understands Virginia's rules saves real time. See below for our recommendation.
Frequently Asked Questions
How do I register as a new employer in Virginia?
Register for a state withholding account with the Virginia Department of Taxation and for an SUI account with the Virginia Employment Commission. You will also need a federal EIN from the IRS.
When must I register as an employer in Virginia?
Register as soon as you know you will hire your first employee, and no later than the date you run your first payroll. State registrations can take several business days to process.
Do I need workers' compensation insurance in Virginia?
Virginia requires workers' compensation coverage once you have more than two employees. Coverage is mandatory with no waivers once you cross that threshold, so check with the Virginia Workers' Compensation Commission or your insurance carrier before you hire your third employee.
What is an EIN and how do I get one?
An Employer Identification Number (EIN) is a federal tax ID from the IRS. Apply online at irs.gov/ein. It is free and you receive it immediately.
Simplify Virginia Payroll
Once your registrations are in place, Gusto is a solid option for keeping up with the ongoing work. It calculates and withholds both federal and Virginia payroll taxes, deposits them on schedule, and files your quarterly and annual returns automatically, which removes most of the deadline-tracking from your plate.
Legal & Tax Disclaimer
This article is for general informational purposes only and does not constitute legal, tax, or professional advice. Employment laws, tax regulations, and compliance requirements change frequently. The information on this page reflects our understanding as of July 2026 and may not reflect recent changes in federal or Virginia state law.
Do not act or refrain from acting based solely on the information in this article. Always consult a qualified attorney, CPA, or HR professional familiar with Virginia law before making payroll or compliance decisions for your business.