Yes! It Costs To Have Pet Sitting Employees: Pay Roll Taxes

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One of the first objections I hear when talking about employees is “They cost a lot.”

I was even one of those people at one time. But guess what? Having a buisness costs money, and you have to spend money to make money.

In a world where everyone is sue happy and the government is coming after businesses because they need money, do employees actually cost money or do they save you money and your sanity?  Stay with me here… we are about to go on a journey.

* So you have an independent contractor, and they are bit by a dog. There goes your sanity and possibly your business.

* You are a control freak and want to know that things are going to be done a certain way and you can tell your clients that things will be done exactly they way they told you…. you will need employees.

* You might run your business 100% the right way with IC’s, but then the government comes along and wants to challenge you. So you start running your mouth explaining what you are doing, say one wrong thing and BOOM they re classify you and ask you for back taxes, penalties, and fines.

There are many other scenarios too. Basically with employees you are paying everything upfront, being able to sleep at night, and knowing that you are within standards in the pet sitting and government worlds.

Taxes are what every business should factor into the cost of doing business. So rather than pay your IC $5 extra, you pay them $5 less and the taxes make up for that difference. Most pet sitters are paying their ICs way too much anyways. Personally I keep labor costs under 40% at the MOST. Usually it is around 35%.

So for those of you who want to know the breakdown, here it is. Straight from the payroll companies mouth. These are AZ percentages. You would have to check with your state for specific info:

7.65% of gross wages FICA taxes- ALL YEAR

2.00% of gross wages AZ State Unemployment Tax (ONLY DUE ON THE FIRST $7,000 EACH EMPLOYEE MAKES, then the tax goes away for the rest of that calendar year)

0.8% of gross wages Federal Unemployment Tax (ONLY DUE ON THE FIRST $7,000 EACH EMPLOYEE MAKES, then the tax goes away for the rest of that calendar year)

2-5% of every hundred dollars of gross wages for Workers’ Compensation coverage (this changes from state to state.)


Okay so how to I determine how much to pay?

Glad you asked!  Give me a call at 480.330.4552 or shoot me an email and I would be glad to guide you!




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2 thoughts on “Yes! It Costs To Have Pet Sitting Employees: Pay Roll Taxes

  1. Kelly Hall Reply

    Hi Bella! I have been closely following your posts/articles about IC vs. employee. Employee definitely sounds like the way to go but I don’t know if I can afford it. I just raised my rates to $17 visit Jan 2014 (I know…) We don’t live in a particularly affluent area (median household income for Medford, OR latest figure $44,810). The minimum wage in Oregon is $9.10/HOUR. Do I have to pay employee for travel time to/from client’s homes? My client area is a 10 mile radius from where I live, so it can take awhile driving. I know every job I have had, I got paid for travel time that was not regular commute to/from the office. I also have to pay a bookkeeper and would have to pay someone to do payroll as I do not have those skills. Your thoughts?

  2. Pingback: How Do I Switch From Pet Sitting Independent Contractors To Employees? - Pet Sitting Business Coaching

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