Total Tax Rate

Total tax rate is computed by adding the (1) computed tax rate, (2) pool cost charge, and (3) fund building charge. Pool cost and fund-building charges are computed each year and are reflected on your annual tax rate notice. Tax rate notices for the upcoming year are mailed in December of each year.

How Your Tax Rate Is Computed

Employers determined eligible for computation are assigned a computed tax rate ranging from 0% to 6.2% (before pool and fund building charges, if applicable) and are notified by the “Tax Rate Notice,” VEC-FC-29. Tax rates are computed, effective January 1 of each year, using the sum of the paid taxable payroll and benefit charges for the four-year period ending on the preceding June 30. The benefit ratio is obtained by dividing the total amount of benefits charged against the account by the total of the paid taxable payrolls. To obtain a percentage, multiply the resulting figure by 100. Payrolls used for this calculation are those for which taxes were paid by September 30 prior to the year for which the rate is being computed.

The computed tax rate is determined by applying the resulting percentage and the trust fund balance factor to the rate tables provided by the law. In addition to the computed tax rate, employers may be assessed additional amounts for pool costs and fund building. These are explained below. §60.2-530, §60.2-531

Pool Cost Charge

The pool cost charge is added to all employers˜ tax rates to compensate for charges that cannot be assigned to any specific Virginia employer. This rate is computed every year based on these costs and other factors. §60.2-532

Fund Building Charge

When the trust fund balance does not exceed 50% of solvency, an additional charge must be placed on all employers. This charge is added to all existing rates in order to keep the trust fund solvent. §60.2-533.

Benefit Charges

When a claim for unemployment benefits is filed, the employer for whom the individual last worked for thirty days (or 240 hours), whether or not such days are consecutive, is the liable employer for the claim. As a result, that employer is charged for any benefit payments made to the individual.

If the following conditions exist, however, no benefit charges are assigned to the last thirty-day employer. The last thirtyday employer will be notified of the exception by Notice of Deputy’s determination:

if the individual’s separation arose as a result of an unlawful act which led to confinement in jail or prison.
if an individual left work to accept other work, genuinely believing the new work to be permanent.
if an offer of rehire was declined because the individual wasin training approved by the Commission, or if an individual left work voluntarily to enter approved training under Section 236 of the Trade Act of 1974, as amended.
if an individual left work voluntarily with good cause due to a personal bona fide medical reason caused by a non-job related injury or medical condition.
If an individual was hired to replace a member of the Reserve of the United States Armed Forces or the National Guard called into active duty in connection with an international conflict and whose employment is terminated concurrent with and because of that member’s return from active duty.

If an individual participating as an inmate in (i) state or local work release programs pursuant to Section 53.1-60 or 53.1-131; (ii) community residential programs pursuant to Section 53.1-177, 53.1-178, and 53.1-179; or (iii) any similar work release program, whose separation from work arose from conditions of release or parole from such program.

If an individual who was unable to work at his regular employment due to a disaster for which the Governor, by executive order, has declared a state of emergency, if such disaster forced the closure of the employer’s business. “Quarterly Charge Statements”(VEC-B-46) are mailed four times a year to advise employers of the individuals and the amount of benefits charged against their accounts. §60.2-528

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Table of Contents Total Tax Rate Useful links	Total Tax Rate Total tax rate is computed by adding the (1) computed tax rate, (2) pool cost charge, and (3) fund building charge. Pool cost and fund-building charges are computed each year and are reflected on your annual tax rate notice. Tax rate notices for the upcoming year are mailed in December of each year. How Your Tax Rate Is Computed Employers determined eligible for computation are assigned a computed tax rate ranging from 0% to 6.2% (before pool and fund building charges, if applicable) and are notified by the “Tax Rate Notice,” VEC-FC-29. Tax rates are computed, effective January 1 of each year, using the sum of the paid taxable payroll and benefit charges for the four-year period ending on the preceding June 30. The benefit ratio is obtained by dividing the total amount of benefits charged against the account by the total of the paid taxable payrolls. To obtain a percentage, multiply the resulting figure by 100. Payrolls used for this calculation are those for which taxes were paid by September 30 prior to the year for which the rate is being computed. The computed tax rate is determined by applying the resulting percentage and the trust fund balance factor to the rate tables provided by the law. In addition to the computed tax rate, employers may be assessed additional amounts for pool costs and fund building. These are explained below. §60.2-530, §60.2-531 Pool Cost Charge The pool cost charge is added to all employers˜ tax rates to compensate for charges that cannot be assigned to any specific Virginia employer. This rate is computed every year based on these costs and other factors. §60.2-532 Fund Building Charge When the trust fund balance does not exceed 50% of solvency, an additional charge must be placed on all employers. This charge is added to all existing rates in order to keep the trust fund solvent. §60.2-533. Benefit Charges When a claim for unemployment benefits is filed, the employer for whom the individual last worked for thirty days (or 240 hours), whether or not such days are consecutive, is the liable employer for the claim. As a result, that employer is charged for any benefit payments made to the individual. If the following conditions exist, however, no benefit charges are assigned to the last thirty-day employer. The last thirtyday employer will be notified of the exception by Notice of Deputy’s determination: if the individual’s separation arose as a result of an unlawful act which led to confinement in jail or prison. if an individual left work to accept other work, genuinely believing the new work to be permanent. if an offer of rehire was declined because the individual wasin training approved by the Commission, or if an individual left work voluntarily to enter approved training under Section 236 of the Trade Act of 1974, as amended. if an individual left work voluntarily with good cause due to a personal bona fide medical reason caused by a non-job related injury or medical condition. If an individual was hired to replace a member of the Reserve of the United States Armed Forces or the National Guard called into active duty in connection with an international conflict and whose employment is terminated concurrent with and because of that member’s return from active duty. If an individual participating as an inmate in (i) state or local work release programs pursuant to Section 53.1-60 or 53.1-131; (ii) community residential programs pursuant to Section 53.1-177, 53.1-178, and 53.1-179; or (iii) any similar work release program, whose separation from work arose from conditions of release or parole from such program. If an individual who was unable to work at his regular employment due to a disaster for which the Governor, by executive order, has declared a state of emergency, if such disaster forced the closure of the employer’s business. “Quarterly Charge Statements”(VEC-B-46) are mailed four times a year to advise employers of the individuals and the amount of benefits charged against their accounts. §60.2-528 back to top Next page
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