Hiring your first employee in Utah

What do you have to register for before your first payroll?

Utah does not issue one combined payroll account. Withholding is a Tax Commission account opened on form TC-69 through Taxpayer Access Point, unemployment insurance is a separate Workforce Services account with its own number, and workers compensation is bought from a private insurer rather than registered with the state. Utah used to run a genuine one-stop at osbr.utah.gov that opened Commerce, Tax Commission and Workforce Services accounts together; that address now redirects to the Division of Corporations, and the state's current combined front door is businessregistration.utah.gov. Workforce Services still offers a standalone path and describes it as the route to take if you are already registered with other agencies and only need an unemployment insurance number, so expect to touch at least three agencies whichever door you start at.

Does Utah require income tax withholding?

Yes. You register with the Utah State Tax Commission, before you have utah employees, by filing form tc-69 at tap.utah.gov.

You withhold if you pay wages for work done in Utah, or pay a Utah resident for work done anywhere else, and Utah states the consequence bluntly: it is a class B misdemeanor to have Utah employees without a withholding license. Two escape hatches exist and both are narrow. An employer doing business in Utah for 60 days or less in a calendar year can ask the Tax Commission to waive withholding, but the waiver is for the employer only and the employee still owes Utah tax; cross 60 days and you owe withholding for the whole period. Separately, a nonresident who works 20 days or less in Utah, has no other Utah income, and lives in a state with no income tax or a matching exclusion is left out of Utah withholding entirely. Watch the rate: the current Withholding Tax Guide, Publication 14 revised April 2026, computes every schedule at 4.45 percent, while the Tax Commission's own income tax rate page still stops at 4.5 percent for 2025. The form is the newer document, so use 4.45 percent and treat the rate page as stale.

What unemployment insurance does Utah charge a new employer?

Utah does not publish one new employer rate, so the figure depends on your industry. There is no single new employer rate in Utah, so none is published here. A new employer is assigned the two year average benefit cost ratio of its own major industry, floored at 1 percent times the reserve factor plus the social cost, which for 2026 means a reserve factor of 1.10 and a social cost fixed at 0.001. Rates for 2026 run from a minimum of 0.1 percent to a maximum of 7.1 percent, and a new out-of-state contractor is handed the 7.1 percent maximum outright unless it bought an existing Utah business. Tax applies to the first $50,700 of each employee's wages in 2026, a base that is recalculated every year from the state average annual wage, and rates for the next year are set in late November. Liability is triggered by almost nothing: employing one or more individuals for any part of a day during a calendar year makes you a subject employer, so there is no headcount or payroll cushion for an ordinary business. Utah publishes no registration deadline in days; the real one is the quarterly report due date, the last day of the month after each quarter ends.

Do you need workers compensation insurance in Utah?

Yes, from your first employee. Utah sets no headcount to reach, so there is no free window before coverage is required.

• every employer with one or more workers or operatives regularly employed in the same business
• employees of a contractor whose work is a part or process in the hiring employer's own trade or business, where the employer retains supervision or control
• directors and officers of a corporation, unless the corporation files written notice excluding up to five of them
• partners and sole proprietors of a motor carrier that employs at least one non-owner and who personally drive

Coverage is required from the first employee and there is no headcount cushion. Utah gives you only two ways to comply: buy a policy from an insurer licensed in Utah, or get approval from the Division to self-insure. The exemptions are narrow and specific. A domestic employer is out only if no single household worker puts in 40 hours a week. An agricultural employer is out if last year's payroll for workers outside the immediate family was under $8,000, and between $8,000 and $50,000 only if it carries $300,000 of liability insurance plus $5,000 of health benefits for those workers. Real estate agents and insurance producers working under written independent contractor agreements are excluded, as are qualifying owner-operator truckers who hold a coverage waiver plus occupational accident insurance. Partners and sole proprietors are outside coverage until they elect in, and corporate directors and officers are inside it until the corporation serves written notice excluding them, capped at five people. The contractor rule is the usual trap: hire a contractor to do work that is part of your own trade and keep supervision or control, and that contractor's staff and subcontractors count as your employees unless you obtain and rely on their certificate of compliance or coverage waiver. Going without coverage is a class B misdemeanor and each day is a separate offense, the Division can get a court to shut the business down, and you lose the tort immunity workers compensation normally buys.

How quickly must you report a new hire in Utah?

Not later than 20 days after the date of hire or date of rehire. Reports go to the Utah Department of Workforce Services, Utah New Hire Registry.

Every hire and every rehire must be reported within 20 days with the employee's name, address, Social Security number and hire date, plus your own name, address and federal tax identification number. Employers approved to report on a semimonthly cycle instead must file batches no less than 12 and no more than 16 days apart, which is a tighter clock than 20 days for some hires. If you employ people in two or more states you may report all of them to a single other state under the federal multistate rule, and Utah then exempts you entirely. Late reporting carries a civil penalty of $25 per failure, rising to $500 where the employer and employee agreed not to report or to report falsely. Reports go through the Workforce Services employer portal, the same login as unemployment tax filing, which is the one convenience Utah does offer here.

Does Utah have paid family leave or state disability insurance?

No. Utah runs no state paid family leave fund and no state disability insurance, so there is no payroll deduction of that kind and no extra account to open.

Utah runs no state paid family and medical leave programme and no temporary disability insurance fund, so there is no payroll contribution of this kind to withhold or match and nothing extra to register for. The division that would administer such a programme enforces only the Utah Payment of Wages Act, the Utah Minimum Wage Act and the Utah Employment of Minors Act on the wage side, and Utah also has no statewide paid sick leave mandate. If you are used to running payroll in Colorado, Washington or California, this is a line item and an account you will not have here. The one Utah-specific wage rule to diarise instead is termination pay: when you separate an employee, all wages are due within 24 hours.

Do you need a sales tax permit in Utah?

The licence itself is free, and this is confirmed in the statute rather than inferred: Utah Code 59-12-106 is headed in part 'No fee' and says a licence shall be issued without a licence fee. Collecting without one is a criminal violation. Three mechanics catch people. A separate licence is required for each place of business if you transact at two or more locations. The licence is not transferable and is valid only until you stop doing business or change your business address, so a move means a new licence, and closing down means filing form TC-69C rather than going quiet, or the Commission estimates tax against you with penalties and interest. Anyone running a one-off event or an event lasting six months or less needs a separate temporary licence even if they already hold a regular one. One number in the state's own explainer is now out of date: Publication 25, revised October 2024, still says you have economic presence with more than 200 sales in Utah, but the 200 transaction test was repealed effective 1 July 2025 and the statute now sets a single threshold of more than $100,000 of gross revenue. Believe the statute.

Security deposits. No routine deposit. A bond is required only where the applicant, a fiduciary of the applicant, or a business they collected for has a sales tax delinquency or a revoked licence, and that bond may not be less than $25,000 or more than $500,000.

Does a marketplace like Amazon or Etsy handle the tax for you?

Utah treats a marketplace facilitator as the seller of everything it facilitates, and a facilitator is on the hook once it makes or facilitates more than $100,000 of Utah sales in the previous or current calendar year. For you as a seller the practical rule is generous and precise: a marketplace seller does not need a Utah sales tax licence for facilitated sales at all unless it has its own Utah nexus and makes sales outside the marketplace. If you do hold a licence, you file returns but do not report the marketplace sales on them, and you are not liable for tax the facilitator was required to collect. You also cannot opt out of having the facilitator collect for you. The trap is the same everywhere: the moment you sell direct through your own site alongside the marketplace, those direct sales are yours to licence, collect and report. Note also that an out-of-state facilitator gets a real grace period, starting collection no later than the first day of the calendar quarter that is at least 60 days after it crosses the threshold, and Utah publishes no equivalent grace for an ordinary remote seller.

If your sales drop, when can you stop collecting?

Utah publishes no rule called trailing nexus, but the statute builds one in. The economic nexus test asks whether your Utah gross revenue exceeded $100,000 in either the previous calendar year or the current one, so a single year over the line obliges you to collect through the whole of the following year even if sales collapse. Only after failing the test in both years can you stop, and stopping is something you must do actively: Utah wants notice immediately when you cease doing business in the state, closed through Taxpayer Access Point or form TC-69C, and if you simply stop filing the Commission may assess estimated tax plus late penalties and interest. Since Utah publishes no wind-down procedure specific to remote sellers, close the account explicitly rather than letting it go dormant.

Does Utah charge a tax on revenue rather than profit?

Utah levies no statewide gross receipts or commerce tax, so there is nothing at state level resembling Washington's B and O tax or Ohio's commercial activity tax. Do not read that as no exposure, because Utah municipalities may impose and collect their own licence fee or tax on revenues, and the Tax Commission's own guidance works an example of a city that has imposed a 2 percent gross receipts tax. The detail that surprises people is what happens next: a city-imposed tax of this kind must be added into the taxable sales you report on your Utah sales and use tax return, so on a $100 sale in that city you report $102 and charge the combined state and local sales tax on the larger figure. In other words you pay sales tax on the city's tax. Check the ordinances of every Utah city you have a physical presence in, because the state cannot tell you what they charge.

Do you have to register your out-of-state company in Utah?

$59 to register a foreign LLC and $59 for a foreign business corporation, from the Division's current published fee schedule. A foreign LLP or LP is $70. Expedited processing adds $75 per filing. Withdrawing later is free. The annual renewal is $18 for both entity types, with a $10 late fee, and a reinstatement costs $18 for every year of renewal you missed. One caveat on the fee figures: the file the Division links as its current fee schedule was last updated in August 2026 but still carries the heading 'Fiscal Year 2026 Fee Schedule, Effective July 1, 2025', so confirm before budgeting a large filing.

The cheaper and simpler route by a wide margin is the LLC. A foreign LLC's registration statement asks only for the company name, its home jurisdiction, its principal office addresses and its Utah registered agent. A foreign corporation must additionally deliver a certificate of existence from its home state dated within 90 days before the filing, so order that first and watch the clock. Both entity types need a registered agent in Utah, and neither filing has anything to do with your tax and payroll accounts: qualifying with Commerce does not open a withholding or unemployment account, and opening those does not qualify you to do business. Utah also spells out what does not count as doing business, including selling only through independent contractors, taking orders that must be accepted outside Utah, and conducting one isolated transaction. Timing note: Utah recodified its business entity statutes effective 1 October 2026, which repeals the foreign registration sections cited here and moves them, so the fee amounts should hold but the statutory citations and possibly the form names change just after this record's review date.

Where these figures come from

Every number on this page was read on Utah's own agency pages, its statute, or a current-year official form, and this record was last reviewed on 2026-09-08. Where a state's explainer page disagreed with its statute or its current form, we followed the statute or the form and said so in the relevant section, because a state's consumer-facing pages are often the last thing updated when a figure changes.

Anything we could not confirm on a primary source is left blank rather than estimated. A missing figure on this page means we could not verify it, not that it is zero.

This is general information, not legal or tax advice. Rules change and your circumstances matter. Confirm anything you are about to act on with the agency named beside it.