Withholding tax is money an employer withholds from an individual’s paycheck and sends to the Tax Commission as a pre-payment toward that individual’s income tax liability. The following entities must withhold:
Because withholding tax is a trust fund tax, an employer must keep the withheld money safe until sending it to the Tax Commission. Individuals claim their withholdings on their Utah income tax returns. Organizations not taxed as individuals, corporations, partnerships, admitted insurers, or trusts may file form TC-20MC, Utah Miscellaneous Corporations Income Tax Return, to claim the credit.
Withholding tax rate tables are found in Publication 14, Employer Withholding Tax Guide. Because Utah has a flat tax rate of 5%, the withholding rates don't change on an annual basis. Use Publication 14 for complete information on withholding taxes.
You can get a withholding tax account (license) by:
- Using OneStop Business Registration to complete an electronic application or
- Completing and submitting the form TC-69, Utah State Business and Tax Registration
There is no fee for a withholding tax account. However, if you have a history of filing or paying taxes late, you may have to post a surety bond.
You need a federal EIN if you are required to report employment taxes or give tax statements to employees. You can request one with the Online EIN Application at the IRS site.
If you stop doing business in Utah, you must submit form TC-69C, Notice of Change for a Business Tax Account. If you do not notify the Tax Commission, you will be assessed an estimated tax, including late penalties and interest.
You can also use this form to notify us of business changes such as contact information. Many changes can also be made online at taxexpress.utah.gov.
See the following references for instructions on filing and paying:
- Pub 14, Employer Withholding Tax Guide
- Pub 32, Online Filing and Paying of Withholding and Mineral Production Taxes
- Pub 68, Utah Pass-through Entity Withholding
- Mineral Production Withholding
- Online Withholding Tax Workshop
- Small Business Employer/Withholding Workshop
- Contact the Tax Commission Taxpayer Services Division