Payroll Tax Meaning and Definition
Payroll Tax
Pronunciation
/ˈpeɪrɒl tæks/
Part of Speech
Noun
Definition
A tax levied on an employer’s payroll, typically used to fund public programs, such as social security, health insurance, and unemployment benefits.
Examples
- Understanding payroll tax can help small business owners make informed decisions about their finances.
- Payroll taxes are often deducted from employee wages and paid by the employer to the government.
Synonyms
- Tax deduction
- Payroll fee
Antonyms
- Subsidy
- Grant
Additional Information
Payroll taxes are typically mandatory and enforced by governing bodies. To ensure compliance, businesses must accurately calculate and submit payroll tax payments on a regular basis. Failure to do so can result in penalties and fines.
Payroll taxes are commonly used to fund public programs such as social security, health insurance, and unemployment benefits. They also help to reduce income inequality by redistributing wealth and providing essential services to individuals and families.
Etymology
The term “payroll tax” originated in the late 19th century, derived from the combination of “payroll” and “tax.”
Usage Notes
Payroll tax is typically used in formal or technical contexts, such as financial reports, tax forms, or legislative documents.
Cultural References
Payroll taxes are often mentioned in business and financial media, such as The Wall Street Journal or Forbes.
Idiomatic Expressions or Phrases
“Payroll to the bone” is an idiomatic phrase used to describe a business or individual using their entire income to pay taxes and bills.
Related Words or Phrases
Payroll, taxes, deduction, fee, subsidy, grant.
Collocations
Payroll tax deduction, payroll tax rate, payroll tax return.
Frequency of Use
Payroll tax is commonly used in formal or technical contexts, with a high frequency of use in financial and business settings.
Common Misspellings
payrole, payrole tax, peyroll tax, etc.