New employers are assigned a benefit ratio based on the two year average benefit
ratio of all employers in their respective industry. The average benefit ratio is
used to determine the overall rate for a new employer. New out-of-state contractors
are assigned the maximum tax rate (7.1%)
allowable under state law unless they purchase an existing business.
New employer rates are assigned upon completion of the
New Employer Registration
process or submission of the Status Report, Form 1. If you register on-line, the tax rate assigned will
become effective after it has been reviewed by the department. If you mail or fax
the registration form, you will receive a notice of your new employer tax rate in
New employers may qualify for a rate based on their actual benefit ratio after they
have paid wages for a period of one fiscal year (July 1 through June 30) prior to
the rate computation date.
Your overall contribution rate will be calculated annually using the following three
Benefit Ratio - determined by dividing the total of all chargeable benefits
paid to your former employees in the last four fiscal years (July 1 - June 30) by
your taxable wages for the same time period. The benefit ratio portion of the overall
tax rate is unique to each employer.
Reserve Factor - adjustment to the benefit ratio (an increase or decrease)
used to maintain an adequate balance in the benefit reserve fund. For
2019, the reserve
meaning the reserve fund
is at an
Social Cost - applied to all employers to recover benefit costs that cannot
be attributed to a specific employer. Social Costs will vary year to year and is
"fixed" at that year’s percentage for all employers. For calendar year
2019, the social
cost is fixed at
for all employers.
To calculate your overall tax rate, the following formula is used:
Benefit Ratio X Reserve Factor + Social Cost
In addition, a 1% surcharge will be added to the overall tax rate if the employer
or the previous owner of the business has unpaid contributions for the prior fiscal
year (July 1 - June 30).
2019, the minimum
overall tax rate is
and the maximum overall tax rate is
Employers who have not paid all contributions for the fiscal year ending June 30th
may be assessed a delinquent payment surcharge of 1.0%, which is in addition to
the overall tax rate.
2019, the taxable
wage base is
$35,300.00. Utah employers
are only liable for state UI taxes on wages paid to each employee up to the taxable
wage base. All wages paid to each employee above the base are considered Excess Wages and are still reported
but not taxed.
Utah's ''benefit ratio" system for calculating unemployment insurance tax rates
allows you the opportunity to manage your unemployment tax costs. For specific recommendations
from the Department on managing these costs, please check out Controlling Unemployment