Payroll Cost per Employee in Pennsylvania
2026 estimates — total employer cost including taxes and benefits
Min wage in Pennsylvania: $7.25/hr (federal minimum; PA minimum wage equals federal minimum) | SUTA: 1.2905–10.5018% on first $10,000
Calculate Total Payroll Cost in Pennsylvania
Payroll Tax Breakdown — Pennsylvania 2026
| Tax / Cost | Rate / Rule | Annual Amount |
|---|---|---|
| Base salary | Per agreement | $59,400 |
| Social Security (employer) | 6.2% on first $168,600 | $3,683 |
| Medicare (employer) | 1.45% of all wages | $861 |
| FUTA (federal unemployment) | 0.6% on first $7,000 | $42 |
| Pennsylvania SUTA | 1.2905–10.5018% on first $10,000 | $450 |
| Benefits (health, 401k, etc) | ~18% of salary (typical) | $10,692 |
| Total Employer Cost | $75,506 | |
Based on $59,400 median salary in Pennsylvania. SUTA rate shown is approximate average — actual rate depends on claims history. Additional: Local Earned Income Tax (EIT): 1–3% in most cities; Philadelphia wage tax 3.75% (residents) / 3.44% (non-residents) for Philadelphia-based employees.
Payroll Requirements in Pennsylvania
1. Pennsylvania Payroll Tax & Compliance Overview
Pennsylvania payroll has two layers of complexity beyond most states: state income tax withholding (3.07% flat) plus local earned income taxes (EIT) that vary by municipality (typically 1–2%, up to 3.44% for Philadelphia non-residents and 3.75% for Philadelphia residents). Employers must register with and remit local EIT for every taxing municipality where employees work. Philadelphia-based employers also face significant compliance overhead with the Philadelphia wage tax and mandatory sick leave ordinance.
2. Top Tips for Pennsylvania Employers
Pennsylvania employers: use payroll software that handles PA local EIT withholding — Gusto, ADP, and Paychex all manage Pennsylvania's local tax requirements. Register with CLGS (Keystone Collections Group) or DCED for local EIT if your employees work outside Philadelphia. For Philadelphia employees, configure both the resident and non-resident wage tax rates separately.
3. Key Pennsylvania Payroll Facts
- Minimum wage: $7.25/hr (federal minimum; PA minimum wage equals federal minimum)
- State income tax: 3.07% flat rate
- State unemployment (SUTA): 1.2905–10.5018% on first $10,000
- Additional: Local Earned Income Tax (EIT): 1–3% in most cities; Philadelphia wage tax 3.75% (residents) / 3.44% (non-residents) for Philadelphia-based employees
Run Pennsylvania Payroll Automatically
Automated payroll software handles Pennsylvania tax calculations, filings, and W-2s for $40–$150/month.
Payroll Software Cost Comparison — Pennsylvania 2026
At $6,292/month total employer cost, automating payroll for $59,400 median salary employees costs 27% above base salary. Software adds just 0.1–0.3% but eliminates costly compliance errors.
| Software | Base Price | Per Employee |
|---|---|---|
| Gusto Top pick | $46/mo | +$6/emp/mo |
| QuickBooks Payroll Core | $45/mo | +$6/emp/mo |
| ADP Run Essentials | ~$65/mo | +$4/emp/mo |
| Rippling | $35/mo | +$8/emp/mo |
Prices as of 2026. All four platforms handle Pennsylvania state tax filings automatically. 10-employee team example: Gusto = $106/mo, QuickBooks = $105/mo, ADP ≈ $105/mo, Rippling = $115/mo.
Frequently Asked Questions
Pennsylvania Payroll Summary
- →Avg salary: $59,400/yr
- →Total cost: $75,506/yr
- →Overhead rate: ~27% above salary
- →Min wage: $7.25/hr (federal minimum; PA minimum wage equals federal minimum)
- →State income tax: 3.07% flat rate