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Wage Tax

Overview

The City Wage Tax is a tax on salaries, wages, commissions and other compensation paid to an employee who is employed by or renders services to an employer. Generally, individuals who work for a company in Pennsylvania will find that the company deducts the Wage Tax from their pay since this is required by law.

All Philadelphia residents owe the City Wage Tax regardless of where they work. Non-residents who work in Philadelphia must also pay the Wage Tax.

Who Must File

All employers located in Pennsylvania are required to register with the City of Philadelphia within 30 days of becoming an employer of a resident of Philadelphia or of a non-resident of Philadelphia doing business in Philadelphia.  Employers are required to withhold and remit the Wage Tax at the prescribed rate from all residents of Philadelphia or non-residents doing business in Philadelphia in its employ.  Employers and payroll service companies must also remit W-2s to Philadelphia. W-2 submission instructions are in the Common Forms box to the right.

If you are a resident of Philadelphia or a non-resident who works in Philadelphia, and your employer is not required to withhold the tax, you must register for an Earnings Tax Account. You can register for an Earnings account on our website using your Social Security Number.

Filing Frequency Determination

The filing frequency is determined by the amount of wage tax withheld by the employer according to the following schedule:
  • Quarterly: Less than $350 Philadelphia per month.
  • Monthly: Greater than $350 but less than $16,000 per month.
  • Semi-Monthly: For an employer with bi-weekly payroll who withholds Philadelphia wage taxes of $16,000 or more per month.
  • Weekly: Greater than $16,000 or more per month.

Semi-Monthly and Weekly wage tax payers must remit their wage tax payments electronically through the Automated Clearing House (ACH).  Learn more under Payments & E-File.

Non-Payroll Period

If you do not have payroll for a reporting period, you must submit a zero payment return or visit the E-File page to report your NTL (No Tax Liability) indicating no tax due to prevent a non-filer notice. Any period without a filed return will be classified as a non-filer. As a result, court filings and fines will be imposed upon the taxpayer. Employers with active wage accounts and no Philadelphia wage withholding should complete a change form to cancel the wage account.

Payroll Service Companies

Payroll Services remitting Philadelphia Wage Tax payments for their clients are required to remit these payments electronically by either ACH Credit or Debit. Established City Wage account numbers and filing frequencies should be obtained from your client upon enrollment. A client who does not have a City Wage account number must register for one.

Payroll service companies must follow Revenue file specifications when remitting returns.  Download the payroll specification document for the requirements.

Non-Taxable Income for Wage Tax

  • A scholarship or stipend as part of a degree program AND you do not provide a service
  • Pension payments
  • Workmen's compensation
  • Active military service pay and bonuses
  • Death Benefits
  • Employer paid insurance premiums
  • Witness and juror fees

 

Overview

Tax Type Code
01

Rate
3.924% (Resident)
3.495% (Non-Resident)

Weekly Filers
Must remit payment electronically

Monthly. Semi­-Monthly & Quarterly Filers
Mail Payments with Coupons to

Philadelphia Dept. of Revenue
PO Box 8040
Philadelphia, PA 19105-8040

Mail Annual Reconciliations
Philadelphia Dept. of Revenue
PO Box 1670
Philadelphia, PA 19105-1670

Wage FAQs

  • What is the Prothonotary's Office?
  • Can you go to jail if you do not pay your taxes?