The Wage Tax must be filed quarterly and paid on a schedule that corresponds with how much money is withheld from employees’ paychecks. See below to determine your filing frequency.
for residents of Philadelphia, or 3.44% for non-residents
Who pays the tax
The Wage Tax is a tax on salaries, wages, commissions, and other compensation. The tax applies to payments that a person receives from an employer in return for work or services. All employed Philadelphia residents owe the Wage Tax, regardless of where they work. Non-residents who work in Philadelphia must also pay the Wage Tax.
All employers located in Pennsylvania are required to register with the City of Philadelphia within 30 days of becoming an employer of either:
- A resident of Philadelphia, or
- A non-resident of Philadelphia who performs services for an employer in Philadelphia.
Employers are required to withhold the Wage Tax from all employees who meet these criteria.
Quarterly filing schedule
All Wage Tax reconciliations and corresponding schedules must be filed on the Philadelphia Tax Center.
|Quarter||Period begins||Period ends||Due date|
|First||January 1, 2023||March 31, 2023||May 1, 2023|
|Second||April 1, 2023||June 30, 2023||July 31, 2023|
|Third||July 1, 2023||September 30, 2023||October 31, 2023|
|Fourth||October 1, 2023||December 31, 2023||January 31, 2024|
As an employer, your payment filing frequency is determined by the amount of Wage Tax you withhold.
|Total Wage Tax withheld||Payment filing frequency|
|Less than $350 per month||Quarterly|
|$350 to $16,000 per month||Monthly|
|$16,000 or more per month (bi-monthly payroll deductions)||Semi-monthly|
|$16,000 or more per month||Weekly|
Tax rates, penalties, & fees
How much is it?
|Effective date||Resident rate||Non-resident rate|
|July 1, 2023||3.75%||3.44%|
|July 1, 2022||3.79%||3.44%|
|July 1, 2021||3.8398%||3.4481%|
|July 1, 2020||3.8712%||3.5019%|
|July 1, 2019||3.8712%||3.4481%|
|July 1, 2018||3.8809%||3.4567%|
What happens if you don't pay on time?
If you don’t pay on time, interest and penalties will be added to the amount you owe.
Interest and penalty is due on any unpaid taxes at the rate specified by Philadelphia Code 19-509.
For more information about rates, see our Interest, penalties, and fees page.
Discounts & exemptions
Are you eligible for a discount?
Income-based Wage Tax refund
If you have tax forgiveness under PA 40 Schedule SP, you may be eligible for an income-based Wage Tax refund. A taxpayer (residents or non-resident) with PA tax forgiveness pays Wage Tax at a reduced 1.5% rate. You’ll receive a refund for any Wage Tax above the 1.5% discounted rate.
To apply for an income-based Wage Tax refund, you’ll need to attach your completed Pennsylvania Schedule SP. The City of Philadelphia will check to make sure your Schedule SP matches the state’s records.
Non-Pennsylvania residents who work in Philadelphia but do not file a Pennsylvania income tax return must include a signed copy of their state income tax return to be eligible for the income-based rates.
Refunds for time worked outside Philadelphia
If you pay more Wage Tax than is due, you can file a claim to have the excess amount refunded to you. This might happen if you’re a non-resident and your employer withholds Wage Tax for time you spent working outside Philadelphia. To receive that portion of Wage Tax back, you’ll need to request a Wage Tax refund.
Can you be excused from paying the tax?
Some forms of income are exempt from the Wage Tax. These include:
- A scholarship received as part of a degree program, for which you do not provide a service
- Pension payments
- Benefits arising under the Workmen’s Compensation Act
- Active military service pay and bonuses
- Death benefits
- Employer-paid health insurance premiums (uniformly provided to all employees)
- Witness and juror fees
- Sick or disability benefits
- Proceeds of life insurance policies
How to pay
Employers must file and pay the Wage Tax on the Philadelphia Tax Center at the frequency outlined on this page.
Employers and payroll service companies must also submit W-2s to the City of Philadelphia. Refer to our W-2 submission guidelines for details.
Payroll service companies
Payroll services that remit Philadelphia Wage Tax payments for their clients must make these payments electronically. The ACH Debit EZ-pay (by phone) program is no longer available.
You should obtain your client’s established City Wage account numbers and filing frequencies upon enrollment. A client who does not have a City Wage account number must register for one through the Philadelphia Tax Center.
Payroll service companies must follow Revenue file specifications when remitting returns. Download the payroll specification document for the requirements.
If you’re an employee of a company located in Pennsylvania, Wage Tax will be automatically withheld from your paycheck.
You’ll need to pay Earnings Tax if:
- You are a resident of Philadelphia or a non-resident who works in Philadelphia, and
- Your employer is not required to withhold the Wage Tax.
Forms & instructions
- Wage Tax policy guidance for non-resident employees (UPDATED)
- Wage Tax guidance for non-resident employees (REVISED)
- Wage Tax Frequently Asked Questions (REVISED)
- Wage Tax refunds
- Income-based Wage Tax refund
- Wage Tax refund form (salaried employees) for all eligible years
- Wage Tax refund form (commissioned employees) for all eligible years
- Earnings Tax (employees)
- Historic tax rate schedule