What payroll taxes does a Vermont employer pay?

Beyond the federal Social Security (6.2%) and Medicare (1.45%) employer match, a Vermont employer pays FUTA — federal unemployment tax — and Vermont state unemployment insurance (SUI). FUTA is 6.0% on the first $7,000 of wages but drops to an effective 0.6% after the 5.4% state credit. Vermont SUI applies to the first $14,800 of wages in 2025 at your assigned rate.

What is the Vermont SUI taxable wage base for 2025?

Vermont's unemployment insurance taxable wage base is $14,800 for 2025. Employers pay UI tax only on the first $14,800 of each employee's annual wages; earnings above that are not subject to Vermont SUI. The wage base is reviewed annually by the Vermont Department of Labor.

What SUI rate do new Vermont employers pay?

Most new non-construction employers in Vermont are assigned a new-employer SUI rate of 1.0%. After your business builds an experience history, your rate is recalculated each year and can range from roughly 0.4% to 5.4% depending on your unemployment claims experience and the overall trust-fund balance.

Does Vermont have an employer disability or paid-family-leave payroll tax?

No. As of 2025 Vermont has no mandatory state disability insurance (SDI) or paid-family-and-medical-leave (PFML) payroll tax. Vermont's family-leave benefit program is offered through private insurance rather than a state-run payroll deduction, so it is not included in this employer payroll tax estimate.

Why is the FUTA rate only 0.6% and not 6.0%?

FUTA's statutory rate is 6.0% on the first $7,000 of each employee's wages, but employers who pay their state unemployment tax on time receive a 5.4% credit, leaving an effective rate of 0.6% — a maximum of $42 per employee per year. The full 6.0% only applies in 'credit reduction' states with outstanding federal loans, which Vermont is not for 2024.

Vermont Employer Payroll Tax Calculator

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Hiring in Vermont carries employer-side payroll taxes that go beyond an employee’s gross wage. This calculator estimates the two costs unique to unemployment funding — federal FUTA and Vermont state unemployment insurance (SUI) — per employee and across your whole payroll. It uses Vermont’s 2025 SUI taxable wage base of $14,800 and the effective 0.6% FUTA rate that applies to compliant Vermont employers.

How it works

Two separate taxes fund unemployment insurance, each capped at its own wage base:

FUTA — the Federal Unemployment Tax Act levies 6.0% on the first $7,000 of each employee’s wages. Employers who pay state UI on time earn a 5.4% credit, leaving an effective rate of 0.6% — a maximum of $42 per employee per year. Vermont is not a credit-reduction state for 2024, so the 0.6% rate applies.
Vermont SUI — Vermont taxes the first $14,800 of each employee’s wages (2025 base) at your assigned experience rate. New employers default to 1.0%.

Per-employee employer tax = (min(wages, 7000) × 0.006) + (min(wages, 14800) × your_rate). The total simply multiplies that by your headcount.

Notes and example

For an employee earning $45,000 with a new-employer SUI rate of 1.0%: FUTA = $7,000 × 0.6% = $42; Vermont SUI = $14,800 × 1.0% = $148; combined per-employee employer cost = $190 per year. Multiply by your headcount for the team total.

This estimate excludes the employer share of Social Security (6.2%) and Medicare (1.45%), which are federal and apply to nearly all wages. It also excludes workers’ compensation insurance, which Vermont requires separately. Your exact SUI rate appears on your annual Vermont Department of Labor notice — always use that figure for budgeting and verify current bases at labor.vermont.gov.