UI is paid by the employer. Tax-rated employers pay a percentage on the first $7,000 in wages paid to each employee in a calendar year. The UI rate schedule and amount of taxable wages are determined annually. New employers pay 3.4 percent (.034) for a period of two to three years. We notify employers of their new rate each December. The maximum tax is $434 per employee per year (calculated at the highest UI tax rate of 6.2 percent x $7,000.)
EDD definitely has a web page or FAQ document where they tell you how your premium is calculated, so do some looking for it. In most state’s there’s a base rate and then some formula based on the amount they’ve paid out to your ex-employees vs the amount you’ve paid in. If you have low turnover, that ratio is probably pretty low and it seems unlikely your premium will increase by much.
And like /u/beamdriver said, there’s a high bar to deny UI - firing someone for poor performance won’t disqualify them.
Gusto is providing:
If you ever intend to hire an employee, keep your current setup. If you’re only ever going to be a sole proprietor, I’d still keep your current setup. This sub is full of “I haven’t paid taxes in X years, how screwed am I?” posts, and automating your own payroll is a great way not to get into that situation.
Depending on your business, a bookkeeper/PA might be helpful - in which case they’ll be employee #2 and you’ll be glad you’re incorporated and have a payroll service already. Definitely find an insurance agent so you can get liability and maybe Errors-and-Omissions insurance (again, industry-dependent).
Your CPA will not be annoyed you’re using Gusto for payroll. You can even delegate access to them so they can pull whatever reports they need come tax time, which will save the CPA time and you money.
For context, I am literally looking at a pile of coffee shop equipment which I’m storing as a favor, because someone had a dream, got in over their head, and lost it all. So my first reaction is, naturally, “horrible idea.”
Ultimately, that $300k is going to be guaranteed by you, personally. Only after you’ve been in business for a long time with proven profitability and $M in cash, will any bank give you a sizeable loan secured only by the business, itself.
So if you have the assets and can take on the debt without ruining your personal finances, go for it. If the shop runs into a bad couple of months and you’ll lose your home, then don’t.
https://edd.ca.gov/en/payroll_taxes/what_are_state_payroll_taxes/#:~:text=Unemployment%20Insurance%20(UI)%20Tax&text=Tax%2Drated%20employers%20pay%20a,of%20two%20to%20three%20years.