Payroll Service Providers - EFT Mandates

Virginia Code Requirements

• Payroll Service Providers/Bulk Filers -- All persons who act on behalf of 100 or more taxpayers to remit individual income tax withholding payments must remit all such withholding payments by ACH Credit transactions. Banking information to be provided to your bank may be found in the Electronic Payment Guide. 
• Monthly Liability greater than $20,000 -- Business taxpayers whose average monthly liability exceeds $20,000 must pay their state taxes by EFT.The $20,000 average monthly tax liability applies to business taxpayers paying corporate income tax, retail sales and use tax, and withholding tax. The $20,000 average monthly tax liability applies separately to each tax. Mandatory EFT filers are notified by TAX that they must begin making EFT payments.  Taxpayers who are required to pay by EFT but continue to pay their tax by check are subject to penalties. 
• Employers--Employers who furnish 50 or more withholding statements, Form W-2, to employees during the calendar year, are required to file their annual statements electronically using Web Upload. Virginia TAX no longer accepts W-2s filed on CD, diskette or tape.

Electronic Submissions (EFT)

EFT payments eliminate VA-5 and VA-15 form filings.

All EFT Withholding filers must continue to file Form VA-6, annual reconciliation, along with W-2 forms reflecting Virginia Withholding.The Form VA-6 is due by February 28 each year, or within 30 days after the last payment of wages. W-2 and 1099-R data may be sent electronically using Web Upload. NOTE: W-2 and Form VA-6 information are two separate statements. Uploading W-2 data to Web Upload will NOT automatically create your VA-6.

Semi-Weekly EFT filers must continue to file Form VA-16, Employer's Quarterly Payments Reconciliation and Return, to reconcile the payments that were made throughout the quarter.  Semi-Weekly filers must now submit the VA-16 electronically using eForms, Business iFile, or Web Upload.

Monthly and Quarterly EFT filers simply make an EFT payment for each period. When no payment is due because the tax liability is zero, a ZERO liability must be reported to the Tax Department. To do this, report a zero payment as an EFT transaction. Otherwise, you will be subject to late filing penalties.

Guidelines

Guidelines are available on the following topics:

• Electronic Payment Guide 
• Employer Withholding Tax Calculator

Last Updated 8/15/2012 12:53