Employers with one or more employees in Hawaii must deduct and withhold Hawaii state income taxes from employee's wages. Employers may use official wage bracket tables available from the Department of Taxation or the formula method of computation to determine the amount to be withheld each pay period.
Wages subject to withholding. Withholding applies to:
• Wages of residents, regardless of where earned
• Wages of nonresidents for income earned in Hawaii
Hawaii conforms to the Internal Revenue Code.
Hawaii requires withholding from wages of certain agricultural and domestic employees who are exempt from federal withholding. Withholding applies to all wages, including cash payments such as salaries, commissions, and bonuses, as well as the market value of noncash payments such as meals, lodging, and goods. Meals and lodging provided for the employer's convenience are exempt from withholding.