Key takeaways
- Add each employee's annual wages and your UI rate to see what you owe EDD for 2026.
- UI (3.4% for new employers) and ETT (0.1%) apply only to the first $7,000 of each employee's wages, and you pay them.
- SDI is 1.3% of all wages in 2026 with no cap, withheld from employees' pay rather than paid by you.
See what your business owes the Employment Development Department in 2026. Add each employee's expected annual wages and your UI rate.
New employers pay 3.4% for two to three years. Established employers get a rate from EDD each December (1.5% to 6.2% in 2026).
| Employee | Wages | UI (employer) | ETT (employer) | SDI (withheld) |
|---|---|---|---|---|
| 1 | $50,000 | $238.00 | $7.00 | $650.00 |
| 2 | $0 | $0.00 | $0.00 | $0.00 |
| Total | $50,000 | $238.00 | $7.00 | $650.00 |
2026 rules: UI and ETT (0.1%) apply to the first $7,000 of each employee's wages and are paid by you. SDI (1.3%) is withheld from all wages, with no cap. State income tax (PIT) withholding depends on each employee's DE 4 and isn't included. Estimate only.
How the calculator works
California has four payroll taxes managed by EDD. The calculator covers the three with fixed formulas:
| Tax | Who pays | 2026 rate | Applies to |
|---|---|---|---|
| Unemployment Insurance (UI) | Employer | 3.4% for new employers; 1.5% to 6.2% for others | First $7,000 per employee |
| Employment Training Tax (ETT) | Employer | 0.1% | First $7,000 per employee |
| State Disability Insurance (SDI) | Employee (withheld) | 1.3% | All wages, with no cap |
| Personal Income Tax (PIT) | Employee (withheld) | Varies | Not calculated; depends on each employee's DE 4 |
Because UI and ETT stop at $7,000 per employee, most of that tax is paid early in the year, often in the first quarter for full-time staff.
Worked example
A new employer with one employee earning $50,000:
| Tax | Calculation | Amount |
|---|---|---|
| UI | 3.4% × $7,000 | $238 |
| ETT | 0.1% × $7,000 | $7 |
| SDI withheld | 1.3% × $50,000 | $650 |
The employer pays $245 to EDD in UI and ETT for this employee for the year. The $650 SDI is taken from the employee's pay and sent to EDD along with it.
Don't forget the filings
- Register with EDD within 15 days of paying more than $100 in wages in a quarter.
- Report new hires on the DE 34 within 20 days of their start date.
- File DE 9 and DE 9C every quarter, even with no payroll. Reports are late after the last day of the month after each quarter ends.
See the full California employer payroll tax guide.
Frequently asked questions
What payroll taxes do California employers pay?
Employers pay Unemployment Insurance (UI) and the Employment Training Tax (ETT), both on the first $7,000 of each employee's wages. Employers also withhold SDI and state income tax from employees' pay and send them to EDD.
What is the California UI tax rate for new employers in 2026?
New employers pay 3.4% for two to three years. After that, EDD assigns a rate each year based on your experience. In 2026 rates range from 1.5% to 6.2%.
Is there a wage limit for SDI in 2026?
No. Since 2024, SDI is withheld from all wages with no cap. The 2026 rate is 1.3%.
Does the calculator include federal payroll taxes?
No. It covers California EDD taxes only. Federal Social Security, Medicare and federal unemployment (FUTA) taxes are separate.
Is this calculator official?
No. It's an independent estimate using EDD's published 2026 rates. Your actual UI rate is on the rate notice EDD sends you. Nothing you enter leaves your browser.
Sources
We use primary sources: statutes, court rules, official forms and government pages. Read our editorial standards.