Taxation in Delaware

Updated on Friday 27th January 2023

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Delaware is a respected business jurisdiction in the USA and a tax shelter for those looking to register their offshore companies and protect their money. There are several tax advantages offered in Delaware, an American state open to all sorts of businesses. Our company formation agents in USA can provide you with in-depth information about how you can open a company here and about the tax structure in Delaware.
 

What types of taxes are imposed in Delaware?


The franchise tax and the corporate income tax are imposed for limited liability companies, and general and limited partnerships in Delaware. It is good to know that the taxation on the personal state tax return is made only if the company's revenues pass through individually.

Foreign entrepreneurs who want to set up a branch in USA have our services at their disposal. Our team of company formation agents in USA has an extensive experience in a wide range of aspects related to the incorporation of a company in any American state. It is important to have support by your side when preparing the documents, registering with the tax authorities, and obtaining the necessary business licenses. Contact us as soon as you decide on this type of structure.
 

Traditional corporations and the franchise tax in Delaware


The franchise tax is calculated in two different ways: the Authorized Shared Method and the Assumed Capital Value Method, as seen in the tables below:
 
  • The franchise tax and the Authorized Share Method – the flat fee is imposed on the number of the authorized shares in the corporation in Delaware.
Shares Flat Fee
Up to 5,000 $175
Between 5,001 and 10,000  $250
10,000 and more  $250 plus $85 for each additional 10,000 or for a fraction of it
 
  • The franchise tax and the Assumed Capital Value Method – the flat fee depends on the amount of the assumed no-par capital, plus a fee for the assumed par value capital for corporations in Delaware.
Capital Flat Fee
Up to $500,000   $175
Between $500.001 and $1 million $250
More than $1 million $250 plus $85 for each additional $1 million or a fraction of it


Tax reliefs for offshore companies in Delaware


Delaware offshore limited liability companies with no business activities in this state are not subject to taxation, meaning that there is no federal or state income taxes, no inheritance tax and no fees for the transfer of shares. However, a license fee is imposed by the government for offshore LLCs in Delaware.
 

Is there a sales tax imposed in Delaware?


No, there is no sales tax in Delaware. The state is among the few others in USA which does not impose a sales tax on goods and services provided. We invite you to solicit information about how to create an offshore company in Delaware and find out details about the advantages of opening a business in this state. You can also request support if you want to start a business in USA regardless of the chosen state for future operations.

We invite you to contact our specialists for assistance in USA company formation and in tax compliance for each state.