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Navigating California Payroll Taxes
While federal payroll tax obligations are essential, staying compliant with California’s state-level requirements is equally important for your business.
California has some of the most detailed employer reporting rules in the country, covering new hire reporting, payroll tax registration, ongoing wage reporting, and timely tax payments.
This guide walks you through everything you need to know about California's new hire reporting and payroll & wage tax requirements, including the key forms you must file, reporting deadlines, and compliance procedures enforced by the Employment Development Department (EDD).
Form DE 34: California New Hire Reporting
Employers in California are required to report all newly hired and rehired employees to the California New Employee Registry, administered by the Employment Development Department (EDD).
This reporting requirement supports both state and federal compliance efforts by helping the state enforce child support orders, prevent unemployment insurance fraud, and maintain accurate employment and wage records.
Who must report
All employers who hire or rehire employees who perform services in California must report those new hires to California’s New Employee Registry — this includes in-state and out-of-state employers with employees working in California. Rehires (employees rehired after a separation of at least 60 consecutive days) must also be reported.
What to report
When reporting a new hire, the employer must provide:
- Employer information: Business name, address, EDD payroll tax account number, Federal Employer Identification Number (FEIN), and contact phone.
- Employee information: Employee name, address, Social Security Number (SSN).
- Start-of-work date: The first day the employee performed services for wages.
When to report
Report within 20 calendar days of the employee’s start-of-work date (the first day services were performed for wages). If you report electronically through e-Services for Business, you may submit two monthly electronic reports that are 12–16 days apart instead of individual reports. Learn more
How to report
You can submit your new hire reports using the following methods:
1. Online (Recommended):
- File via EDD e-Services for Business (NER electronic filing). This is the preferred, fastest method.
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2. Fax:
- Download the Form DE-34 (PDF).
- Complete the form and fax it to 916-319-4400.
- Keep a copy of the fax confirmation for your records.
3. Mail:
Complete the New Hire Reporting Form and mail it to:
EMPLOYMENT DEVELOPMENT DEPARTMENT
PO Box 997016, MIC 96
West Sacramento, CA 95799-7016
Use certified or trackable mail for proof of delivery.
For Multistate Employers:
Employers hiring in more than one state can choose to electronically report all newly hired employees to one state in which they have employees. Learn more
New Hire Reporting Penalties:
- $24 per failure to report (per employee) if the report is late or missing (unless good cause is shown).
- $490 per employee if the EDD determines the failure to report was the result of an intentional agreement between the employer and employee to not supply required information or to supply false/incomplete information.
Corrections
If you need to correct or remove an employee previously reported:
- Use e-Services for Business to submit corrected data.
- Or submit an amended DE 34 (follow the instructions on the DE 34 and the EDD Electronic Filing Guide).
Form DE-9 / DE-9C: California Payroll Withholding & Quarterly
Wage Reporting
California’s Quarterly Contribution Return and Report of Wages comprises Form DE-9 (grand totals & return) and Form DE-9C (detailed employee wage continuation). Employers use these forms to report total taxable wages, contributions, PIT withheld, and to remit UC/SDI/ETT contributions as applicable.
Who Must File
All California employers with employees are required to file the quarterly DE-9 and DE-9C, unless you are an employer of household workers or other exempt categories that use different forms (see DE 44 employer’s guide). The filing frequency and deposit requirements depend on your tax account classification and withholding amounts. New employers must register and file as directed by the EDD.
Even if no tax is withheld, you must still file Forms DE-9 and DE-9C on time by selecting No to the question "Do you have payroll to report?"
Form Types
- DE-9 — Quarterly Contribution Return and Report of Wages (grand totals and return).
- DE-9C — Quarterly Contribution Return and Report of Wages (Continuation) — detailed employee wage lines, PIT wages and PIT withheld amounts, etc.
- DE-88 – used to report and pay Unemployment Insurance (UI), Employment Training Tax (ETT), State Disability Insurance (SDI) withholding, and California Personal Income Tax (PIT) withholding to us. A DE 88 coupon is not required when payments are submitted electronically.
- DE-9ADJ — used to request adjustments to previously filed DE-9 / DE-9C reports.
What to Report
- DE-9 (grand totals): total number of employees, total taxable wages for the quarter, total contributions due, total PIT withheld (if any), and payment voucher info. If DE 9 shows an overpayment, you will receive a refund automatically. If a tax payment is due, you should submit your payment separately with DE-88.
- DE-9C (continuation): each employee’s name, SSN, total wages for the quarter, PIT wages, PIT withheld, and wage classifications (as required). The DE-9C contains “PIT wages” fields used by the FTB to verify state income tax wages.
When to File
-
DE-9/DE-9C are quarterly returns. Due dates generally follow the calendar quarter schedule:
- Q1 (Jan–Mar) — due April 30
- Q2 (Apr–Jun) — due July 31
- Q3 (Jul–Sep) — due October 31
- Q4 (Oct–Dec) — due January 31 (following year)
- Special cases: If you close your business during a quarter, you must file DE-9/DE-9C within 10 days of closing.
How to File
You have several filing options to file Form DE-9 and DE-9C
-
EDD e-Services for Business — Online filing (recommended):
All employers, including out-of-state employers, are required to submit their Form DE-9, DE-9C, and payroll tax deposits electronically. Employer representatives who file and pay for an employer must also file and pay electronically. e-Services for Business is the fast, easy, and secure way to comply with the mandate and manage your employer payroll tax account online.
-
Paper filing (limited):
EDD encourages online filing; paper forms are still available, but many employers are required to e-file. If you file by paper, follow the form instructions and mail to the addresses specified on the form.
The mandate has a waiver provision if you are unable to submit your Form DE-9 and DE-9C electronically. The EDD will no longer accept paper tax returns without an approved E-file and E-pay Mandate Waiver.
To request a waiver, you must complete and submit the Form DE 1245W.
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How to pay (deposit & payment methods)
- E-pay (EDD e-Services) — employers can make payments when submitting returns online.
- DE 88 — Payroll Tax Deposit (submit deposits as required for your deposit schedule).
- Payment methods: ACH debit via e-Services is common; some third-party payment vendors are supported — check EDD payment options and electronic deposit schedule. Employers must follow the deposit frequency (monthly, quarterly, semiweekly) determined by EDD.
Deposit Requirements
California Deposit Requirements for PIT and SDI deposit due dates are based on the federal deposit schedule, payday, and state PIT withholding. You must make Monthly SDI and PIT deposits if either:
- You are a Quarterly depositor, but accumulate $350 or more in PIT during one or more pay periods.
-
You are a Next-Day or Semiweekly depositor, and you accumulate $350-$500 in PIT during one or more
pay periods.
Taxable Wage Base & Rates
- Taxable wage base: $7,000 per employee, per calendar year.
- Unemployment Insurance (UI) / SUI Rate: For 2025, the UI contribution rate schedule is Schedule F+, which ranges from 1.5% to 6.2% depending on your employer experience rating.
- New employers’ UI rate: New employers are generally assigned a starting rate of 3.4% for their first 2–3 years.
- Maximum annual UI tax per employee (if at highest rate): If using the top rate 6.2% on the $7,000 wage base – $434 per employee per year.
- Employment Training Tax (ETT): 2025 rate is 0.1%, applied on the same $7,000 wage base.
- State Disability Insurance (SDI) (employee contribution): 2025 withholding rate is 1.2%. For SDI, there is no wage base limit.
Penalties
Refer to the table below for the penalty rates associated with late filing, late payment, and non-compliance.
| Situation / Violation | Penalty Rate / Amount | When Penalty Is Incurred |
|---|---|---|
| Late payment of payroll taxes (if payment due along with DE-9 is not made by the due date) | 15% of the amount due (plus interest) | If taxes are not paid by the due date (or deposit schedule), a penalty and interest are assessed for late payment. |
| Late filing or failure to file DE-9 / DE-9C when electronically mandated |
|
Penalty applies if you fail to meet the electronic filing mandate (after 1 Jan 2019 for active employers) — even if you have no wages to report. |
| Late DE-9C wage report (after demand) |
$20 per unreported (or late) employee wage item |
If EDD issues a written demand for the DE-9C and the employer fails to file within 15 days of the demand, the penalty applies per employee wage item. |
| Late payment when correcting a previously filed DE-9 / DE-9C (via adjustment) | 15% of the portion of the payment that is late (i.e., additional taxes due after correction) | When filing the correction (via e-Services or DE 9ADJ), and you owe additional tax. |
DE-9 / DE-9C Corrections (How to amend)
- Online correction (preferred): Use e-Services for Business to amend previously filed DE-9/DE-9C reports — EDD allows corrections to wage lines, additions, removals, and total adjustments. Learn more.
-
DE-9ADJ: Use Form DE 9ADJ to request adjustments to previously filed DE-9/DE-9C if you cannot file an
electronic amendment.
California Payroll Tax Filing — Simple, Transparent Pricing
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affordable e-filing.
| Forms | Price per Form* |
|---|---|
| Withholding Form (DE-9 or DE-9C) | $5.95 |
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Frequently Asked Questions
Can I use DE-9C (quarterly wage report) to report new hires instead of the new-hire registry form?
No. DE-9C is for quarterly wages and contributions; to comply with new-hire reporting, you must use DE-34 (or e-Services) within 20 calendar days of hire.
Is DE-9 / DE-9C still required if I paid no wages in a quarter?
Yes. If your business is active, you must file both DE-9 and DE-9C each quarter — even if payroll was zero. You can file “No payroll to report” via e-Services.
What happens if I file DE-9 or DE-9C late — what penalties apply?
Under the e-file / e-pay mandate: failing to file a DE-9 return incurs $50 per return, and failing to file DE-9C wages on time incurs $20 per employee wage item.
If the DE-9C is late after a written demand and not filed within 15 days, EDD charges $20 per wage item (plus interest) unless there is good cause.
What about late payment of payroll taxes (UI, ETT, SDI, PIT)?
If tax payments (via DE-88 or electronic deposit) are late, EDD charges a 15% penalty on the unpaid amount, plus interest.
I discovered an error after submitting DE-9 or DE-9C — how do I correct it?
Use e‑Services for Business to file an adjustment, or submit a paper adjustment form (DE-9ADJ). If additional tax is due, pay it along with a 15% penalty for late payment.
If I switch payroll providers (or use a payroll service), am I still responsible for filing DE-9 / DE-9C?
Yes, ultimately, you are the employer of record, so you remain responsible for timely and accurate filing. Using a service doesn’t relieve you of liability for incomplete filings or late payments. (This is a common compliance issue employers face.)
How does EDD treat under-reporting or missing employee wage lines on DE-9C?
If DE-9C omits wage items or reports incorrect wages, EDD may assess the $20-per-employee wage item penalty (for late or unreported wage lines), plus interest. Underreporting may also trigger additional enforcement if EDD determines willful misreporting.
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