Taxation in Virginia

Updated on Thursday 18th April 2019

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The good news for investors in Virginia is that there are no privilege or franchise tax imposed on companies with establishments in this state. However, business owners should consider the corporate income tax of 6%. It is recommended to have a clear idea about the taxation on business structures available in Virginia and we suggest you to talk to our team of company formation representatives in USA and find out support. They can also help you start a business in Virginia.

Is there an income tax imposed for LLCs in Virginia?

No, limited liability companies in Virginia which are considered pass-through entities do not need to pay the income tax. On the other hand, the income distributed to members who form the company will be subject to the corporate income tax established at 6%. The same thing is available for partnerships or single-member LLCs. You may get in touch with our team of consultants if you want to start a company in USA, including in Virginia, and if you would like to know detailed information about the tax regime in this state.

What is the sales tax in Virginia?

The standard sales tax in Virginia is set at 4.3% for goods and services for sales purposes, mentioning that municipalities can impose their own rate of no more than 1%. A rate of 2.5% is imposed as a sales tax for numerous food products and a rate of 4% for grocery store products and prepared foods. Looking for company formation in USA and wanting to open a business in Virginia? We recommend you to ask for support in taxation matters from our business consultants. 

The taxation on personal income in Virginia

There are four income tax brackets that apply to revenues registered by individuals in Virginia:
Taxable Income Taxes
For the first $3,000 2%
Between $3,001 and $5,000 3%
Between $5,001 and $17,000 5%
For more than $17,0001 5.75%


Other tax facts in Virginia

Investors from abroad will have to observe the applicable legislation for companies in Virginia before commencing the operations. Here is a few information about the taxes imposed in this state:
  1. The property tax of 0.80% is the 17th lowest in USA paid on the property value.
  2. There is no estate tax imposed in Virginia since July 2007.
  3. The capital gains tax in Virginia is set at 5.75%.
  4. One needs to observe the gas, the alcohol, and the cigarette tax.
  5. There is no inheritance tax since June 2007.

What is the litter tax in Virginia?

The litter tax is the kind of tax applicable to businesses in Virginia of USD10/year for each factory or business location. This kind of tax is available for retailers and manufacturers in Virginia, mentioning that extra USD15 is imposed for businesses selling soft drinks, beers, groceries. 

Multistate business and nexus

Investors having a business in Virginia and wanting to expand cross borders must know that they might be subject to nexus. This means that they have to observe the taxes in each state where they want to do business in. The same thing is available for the type of companies registered in USA, but generating the incomes in Virginia. This is known as the multistate business tax for which complete information can be offered by our team of accountants in USA.

Accounting services for my company in Virginia

Running a company in Virginia means taking into consideration a series of factors, starting from the place of business and ending with the accounting department in charge of the financial aspects of your firm. Payroll, bookkeeping, management reporting for internal use assistance in audit procedures, the preparation of financial statements, plus tax compliance and support are among the accounting services a dedicated firm can provide as soon as you decide for doing business in Virginia. Moreover, business debt planning might be recommended for your company in Virginia, alongside tax minimization methods if it is the case. Feel free to address your inquiries to our company incorporation agents in USA if you are interested in accounting matters besides information about how to start a business in Virginia.

Tax minimization strategies in Virginia

Incorporating tax planning in the firm is often the solution of business owners in Virginia. A great fiscal optimization starts with a good plan that shows if specific taxes can be reduced.  Creating a retirement strategy, investing in mutual funds or establishing a foundation are, in most cases, proper options part of tax minimization methods an entrepreneur can consider.
We invite you to contact our team of company incorporation specialists in USA and solicit in-depth information and assistance about how to open a company in Virginia and about the taxes imposed.