Add employee federal and state tax withholdings

Add an employee's federal and state tax information to withhold the correct taxes from their pay. Xero automatically calculates taxes based on the standard rate or withholding allowance.

Before you start

Make sure you:

Add an employee's federal and state tax information

  1. In the Payroll menu, select Employees.
  2. Click the employee's name to open their details.
  3. Click the Taxes tab.
  4. Add the employee's federal and state tax information.

    Make sure you add the employee's filing status, allowances, and any additional withholding amount.

  5. Click Save.