Pennsylvania local payroll
Philadelphia City, PA payroll tax for remote employees (2026): 3.74% wage tax
Philadelphia City levies a 3.74% resident wage tax and a 3.43% non-resident wage tax, collected by CITY OF PHILADELPHIA. Philadelphia sits outside PA Act 32 and runs its own wage-tax system, so start with Pennsylvania employer withholding, unemployment compensation, workers' compensation, and the Philadelphia wage tax.
Resident wage tax
3.74%
Non-resident wage tax
3.43%
Local services tax
$0
PSD code
510101
CITY OF PHILADELPHIA
Rates verified from the official Pennsylvania DCED statewide EIT/PIT/LST register (official rates as of June 15, 2026). CITY OF PHILADELPHIA is the Philadelphia Department of Revenue of record. Confirm account setup and the exact address-level PSD before filing.
Open CITY OF PHILADELPHIAConfirm the address-level PSD
Act 32 withholding is address-sensitive. Use the DCED PSD lookup with the employee's exact residence and work address, and save the generated report for the payroll file.
Open PA DCED PSD lookupFirst-pass checklist
- Register Pennsylvania employer withholding through myPATH if state withholding applies.
- Register or confirm Pennsylvania unemployment compensation account status.
- Collect the PA Residency Certification Form for residence and work PSD codes.
- Apply the Philadelphia City local wage tax (3.74% resident / 3.43% non-resident) through the CITY OF PHILADELPHIA.
- Confirm Pennsylvania workers' compensation coverage for the work location.
Frequently asked questions
What is the local income tax rate in Philadelphia City, PA for 2026?
Philadelphia City levies a 3.74% resident wage tax and a 3.43% non-resident wage tax, collected by CITY OF PHILADELPHIA. Philadelphia is outside Act 32 and runs its own wage-tax system.
Do I withhold local tax for a remote employee working in Philadelphia City?
If an employee lives or works in Philadelphia City, the employer generally withholds the Philadelphia wage tax (3.74% for residents, 3.43% for non-residents who work in the city) and remits it to the CITY OF PHILADELPHIA.
Who collects the Philadelphia City wage tax?
The CITY OF PHILADELPHIA administers the Philadelphia wage tax directly. There is no Act 32 PSD-based collector for Philadelphia.