Virginia Business Tax Rates Explained: Corporate, LLC, and S-Corp

If you run a business in Virginia, one of the easiest ways to make an expensive mistake is to assume there is just one “Virginia business tax.” There isn’t.

Virginia businesses can face state income tax, tax on income passed through to their owners, optional pass-through entity tax, local BPOL tax, and Virginia SCC filing requirements. Which obligations apply depends on how the business is legally organized, how it is classified for federal tax purposes, who owns it, and where it operates.

Key Takeaways

C-Corps generally pay Virginia corporate income tax at a flat 6% on Virginia taxable income.
LLCs are not one tax category. A Virginia LLC may be taxed as a disregarded entity, partnership, S-Corp, or C-Corp.
Single-member LLC income passes through to the owner’s Virginia return, and the LLC normally does not file Form 502 if it is disregarded for federal tax purposes.
Multi-member LLCs, partnerships, and S-Corps are pass-through entities for Virginia income-tax purposes.
Virginia individual income-tax rates range from 2% to 5.75%, and the top 5.75% rate begins once taxable income exceeds $17,000.
Virginia PTET is imposed at 5.75% and may shift payment of qualifying Virginia income tax to the entity level while creating refundable credits for eligible owners.
Virginia’s PTET system is permanent under current law, but the election is made separately for each taxable year.
BPOL is a local tax rather than a state income tax. It is generally based on gross receipts, although statutory thresholds, local exemptions, and other rules may limit what is owed.
Virginia SCC fees and reports are separate from tax returns filed with Virginia Tax or local governments.
Deadlines vary by entity type, and local BPOL due dates differ by county, city, or town.

What Are Virginia Business Tax Rates?

Virginia business tax rates depend on the entity’s tax classification, not just its legal label. A C-Corp may owe Virginia corporate income tax at 6%, while income earned through a disregarded LLC, partnership, or S-Corp generally passes through to the owners and is taxed under the rules that apply to those owners.

An LLC is a legal entity formed under state law, not a single federal tax classification. Depending on the number of owners and elections made, an LLC may be taxed as a disregarded entity, partnership, S-Corp, or C-Corp. (irs.gov) For a broader comparison of these tax classifications, see our guide to choosing between a sole proprietorship, LLC, S-Corp, or C-Corp.

A business may also have several Virginia obligations at the same time. For example, a company could file an income-tax return with Virginia Tax, pay BPOL tax or a license fee to a city or county, and pay an annual registration fee to the Virginia State Corporation Commission.

Virginia Tax Rates Summary by Entity Type

Structure	Virginia state tax	Filed with	Typical due date
C-Corp	6% corporate income tax on Virginia taxable income	Form 500, Virginia Tax	April 15 for calendar-year corporations; 15th day of 4th month after fiscal year-end
Single-member LLC / sole proprietorship	Passed through to owner; Virginia individual rates of 2%–5.75%	Owner’s applicable Virginia return; generally no Form 502 for a disregarded LLC	May 1 for calendar-year individuals
Multi-member LLC / partnership	Passed through to owners; individual owners generally taxed at 2%–5.75%; optional 5.75% PTET	Form 502 or Form 502PTET, plus owners’ returns	April 15 for entity; May 1 for calendar-year individuals
S-Corp	Passed through to owners; individual owners generally taxed at 2%–5.75%; optional 5.75% PTET	Form 502 or Form 502PTET, plus owners’ returns	April 15 for entity; May 1 for calendar-year individuals
Businesses subject to BPOL	Local license fee or gross-receipts tax; varies by locality and classification	Local Commissioner of the Revenue, finance department, or other local assessing office	Between March 1 and May 1 for annual applications or renewals, depending on the locality
SCC-registered LLC	$50 annual registration fee; no annual report	Virginia SCC	Last day of the LLC’s anniversary month
SCC-registered stock corporation	Annual report with no filing fee; annual registration fee of $100–$1,700 based on authorized shares	Virginia SCC	Last day of the corporation’s anniversary month

Virginia imposes corporate income tax at 6%. Individual income-tax rates are 2%, 3%, 5%, and 5.75%, with the top rate applying once taxable income exceeds $17,000. Calendar-year corporate and pass-through entity returns are generally due April 15, while calendar-year Virginia individual returns are generally due May 1. (tax.virginia.gov) (tax.virginia.gov) (tax.virginia.gov)

What Virginia Actually Taxes

Virginia business owners often combine three separate systems into one mental bucket. That causes confusion.

The basic division is:

Virginia state income tax is administered by Virginia Tax.
BPOL is administered by a city, county, or town.
Annual registration fees and entity reports are handled by the Virginia SCC.

An LLC is also not one tax classification. It is a legal entity created under state law. For federal and Virginia income-tax purposes, an LLC might be treated as a disregarded entity, partnership, S-Corp, or C-Corp. (irs.gov)

This article focuses on Virginia income tax, PTET, BPOL, and SCC requirements. It does not comprehensively address sales and use tax, payroll withholding, unemployment tax, local business tangible personal property tax, meals tax, lodging tax, or taxes that apply to specific industries.

How Virginia’s 6% Corporate Income Tax Works

If a business is taxed as a C-Corp, Virginia generally imposes a flat 6% corporate income tax on its Virginia taxable income. (tax.virginia.gov)

This is only the entity-level tax. If the corporation later distributes its after-tax earnings to shareholders as taxable dividends, the shareholders may also owe federal and Virginia individual income tax. Not every corporate distribution is a taxable dividend – a distribution may instead reduce the shareholder’s stock basis or produce capital gain – but this potential second layer of tax is a major distinction between C-Corps and pass-through entities. (irs.gov) (irs.gov) (law.lis.virginia.gov)

Who Files Form 500?

Corporations subject to Virginia corporate income tax generally file Form 500.

For calendar-year corporations, the return is due April 15. A fiscal-year corporation generally files by the 15th day of the fourth month following the close of its taxable year. (tax.virginia.gov)

What Does the 6% Rate Apply To?

The 6% rate applies to Virginia taxable income, not gross revenue.

That distinction matters. A corporation may have $1 million in revenue but substantially less taxable income after expenses, deductions, Virginia modifications, and any applicable allocation or apportionment. The 6% rate applies to the resulting Virginia taxable income rather than the full $1 million of gross revenue. (tax.virginia.gov)

A corporation operating in multiple states may also need to determine how much of its income is taxable by Virginia. The answer can depend on the corporation’s activities, property, payroll, sales, and the apportionment rules applicable to its industry. (law.lis.virginia.gov)

Federal Deductions Do Not Always Carry Over to Virginia

Virginia corporate taxable income starts with federal taxable income, but the federal and Virginia results are not always identical.

Effective February 20, 2026, Virginia replaced its rolling conformity system with a fixed Internal Revenue Code conformity date of December 31, 2025. Virginia conforms to most provisions of the 2025 federal reconciliation law but specifically does not conform to immediate expensing of qualified production property, immediate expensing of domestic research and experimental expenditures, or increases to the federal expensing limits for certain depreciable business assets. Businesses using those federal provisions may need separate Virginia depreciation, amortization, and carryforward records. (tax.virginia.gov)

Virginia conforms to the federal change to the §163(j) business-interest limitation. However, for taxable years beginning in 2025 and later, the Virginia subtraction for federally disallowed business interest was reduced from 50% to 20%. (tax.virginia.gov)

These differences can affect both C-Corps and owners of pass-through entities. A deduction allowed immediately on the federal return may instead be recovered over later years for Virginia purposes.

Estimated Tax Rules Corporations Often Miss

A corporation generally must make Virginia estimated tax payments when its expected state income tax, after allowable credits, exceeds $1,000.

For a calendar-year corporation, the standard installments are generally due April 15, June 15, September 15, and December 15. The standard schedule divides the estimated tax into four 25% installments, although different rules can apply if the estimated-tax requirement first arises later in the year. (tax.virginia.gov)

This catches many owners off guard during a growing year. Filing the annual return on time does not eliminate an addition to tax caused by missing or underpaying required estimates.

How Virginia Taxes Pass-Through Income

Most small businesses in Virginia are not taxed as C-Corps. Instead, their taxable income generally passes through to their owners.

How Are Sole Proprietorships and Single-Member LLCs Taxed in Virginia?

A sole proprietorship does not pay a separate Virginia entity-level income tax. The business income is generally included on the owner’s Virginia individual income-tax return.

The same is true for a single-member LLC that is disregarded for federal tax purposes. In that case, the LLC typically does not file Virginia Form 502. The owner reports the LLC’s income through the owner’s federal and Virginia returns. (irs.gov) (tax.virginia.gov)

This treatment changes if the single-member LLC elects to be taxed as an S-Corp or C-Corp. The fact that the legal entity is still an LLC does not prevent it from having a corporate tax classification. (irs.gov)

How Are Multi-Member LLCs, Partnerships, and S-Corps Taxed?

Multi-member LLCs taxed as partnerships, general and limited partnerships, and S-Corps generally pass income through to their owners.

The entity may still have a Virginia filing obligation, but the owners generally pay the income tax in their individual or separate capacities unless the entity elects Virginia PTET or another entity-level obligation applies. A pass-through entity doing business in Virginia or receiving Virginia-source income generally files Form 502 or Form 502PTET. (tax.virginia.gov)

The precise result depends on the owner. An individual owner, corporation, trust, estate, or another pass-through entity may each face different Virginia reporting and tax rules.

Virginia’s Individual Brackets Compress Quickly

Virginia individual income-tax rates are:

2% on the first $3,000 of taxable income
3% on taxable income from $3,001 through $5,000
5% on taxable income from $5,001 through $17,000
5.75% on taxable income above $17,000

The top 5.75% rate begins at a relatively low taxable-income level. As a result, many profitable business owners face the top Virginia marginal rate on most of their additional pass-through income. (tax.virginia.gov)

What Is Virginia PTET?

Virginia’s Pass-Through Entity Tax, or PTET, is an elective tax that qualifying pass-through entities may pay at the entity level.

How PTET Works

The Virginia PTET rate is 5.75%. An electing entity files Form 502PTET instead of Form 502. (tax.virginia.gov)

The tax base generally includes the pro rata or distributive share of income, gain, loss, and deduction attributable to eligible owners. Eligible owners generally include direct individual owners and qualifying estates or trusts. Corporate owners and other pass-through entity owners are not eligible owners for purposes of the Virginia PTET credit. (tax.virginia.gov)

Eligible owners receive corresponding refundable Virginia tax credits for the PTET paid on their behalf. For a broader discussion of when PTET elections help and when they can create problems, see our guide to Pass-Through Entity Taxes: SALT Cap Workaround or Trap?. (tax.virginia.gov)

Is PTET an Extra 5.75% Tax on Top of the Owner’s Regular Tax?

No. PTET is not simply another 5.75% tax imposed on top of the owner’s normal Virginia income tax.

The entity pays qualifying Virginia income tax at the entity level, and eligible owners generally claim refundable credits for their shares of the tax. In effect, the election changes where the Virginia tax is paid and where the federal deduction is claimed.

Federal guidance generally permits a partnership or S-Corp to deduct qualifying state income taxes imposed on and paid by the entity when computing the income passed through to its owners. This treatment is the basis for the federal PTET benefit. (irs.gov)

The potential federal benefit depends not only on whether the owner is subject to the individual SALT deduction limit, but also on whether the owner itemizes deductions at all. A taxpayer who claims the standard deduction receives no separate federal deduction for personally paid state income taxes. Even when the taxpayer itemizes, some or all of those taxes may merely bring total itemized deductions up to the standard-deduction amount rather than create an incremental tax benefit. Any remaining deduction is also subject to the SALT limit and its modified-adjusted-gross-income reduction. By contrast, qualifying PTET deducted by the entity generally reduces the income passed through to the owner without depending on whether the owner itemizes. As a result, the value of a PTET election can depend heavily on each owner’s filing status, income, itemized deductions, other state and local taxes, and ownership percentage. (irs.gov) (irs.gov) (irs.gov)

PTET also does not always produce an exact economic match for every owner. Differences can arise from residency, owner eligibility, losses, credits, taxes paid to other states, changes in ownership, and the timing of payments. The election should be evaluated using the entity’s and owners’ actual circumstances rather than treated as an automatic benefit.

PTET Estimated Payments and Annual Elections

An electing pass-through entity generally must make estimated PTET payments when its expected PTET exceeds $1,000.

For a calendar-year entity, the standard estimated-payment dates are April 15, June 15, September 15, and December 15. Each installment is generally 25% of the expected tax, subject to the estimated-tax rules and available exceptions. (tax.virginia.gov)

Virginia’s PTET system is permanent under current law. The 2026 Amendments to the 2025 Appropriation Act removed the former sunset after taxable year 2026. (tax.virginia.gov)

The election itself remains annual. A pass-through entity elects PTET for a particular taxable year by filing Form 502PTET. Filing the return binds the entity and eligible owners for that taxable year, but it does not require the entity to elect PTET in future years. (tax.virginia.gov)

When Does Form 502 Apply in Virginia?

Form 502 generally applies to a partnership, multi-member LLC, or S-Corp that is doing business in Virginia or receiving Virginia-source income. (tax.virginia.gov)

A single-member LLC that is disregarded for federal income-tax purposes generally does not file Form 502 solely because it is registered as a Virginia LLC. Instead, the LLC’s activity is reported through its owner’s applicable return. (irs.gov)

Pass-through entities with nonresident owners may also have Virginia withholding obligations. A PTE generally must withhold 5% of each nonresident owner’s allocable share of Virginia-source income unless an exception applies. The nonresident owner generally receives a credit for the amount withheld, so the withholding is a prepayment rather than necessarily the owner’s final Virginia tax liability. (tax.virginia.gov)

PTET can change the withholding analysis for eligible owners, but it does not necessarily eliminate withholding requirements for ineligible nonresident owners, such as nonresident corporate owners. (tax.virginia.gov)

Virginia BPOL Tax: The Local Tax Many Owners Miss

One of the biggest surprises in Virginia business-tax planning is BPOL.

What Is BPOL?

BPOL stands for Business, Professional, and Occupational License tax. It is a local business-license tax authorized by Virginia law.

BPOL is not imposed uniformly throughout Virginia. A city, county, or town may impose a tax, a license fee, or both under its own ordinance, subject to state-law limitations. A locality may also choose not to tax certain classifications or may provide additional exemptions. (law.lis.virginia.gov)

How Do BPOL Rates Work?

BPOL may consist of:

A flat license fee
A tax based on gross receipts
A combination of the two, depending on the locality and the business’s receipt level

Rates vary by locality and business classification. Virginia law generally establishes maximum rates of:

$0.16 per $100 of gross receipts for contractors
$0.20 per $100 for retail sales
$0.58 per $100 for financial, real estate, and professional services
$0.36 per $100 for repair, personal, business, and other services

Wholesale businesses are generally subject to a separate maximum rate based on purchases rather than gross receipts. Certain localities may retain grandfathered rates above the current statutory maximums. (law.lis.virginia.gov)

BPOL Gross-Receipts Thresholds

State law prevents localities with more than 50,000 residents from imposing the BPOL gross-receipts tax on a business with less than $100,000 of gross receipts. For localities with populations between 25,000 and 50,000, the state-law floor is $50,000. (law.lis.virginia.gov)

Those thresholds prevent the gross-receipts tax from applying below the specified amounts, but they do not necessarily eliminate a local license fee. The statutory threshold provision also does not establish the same minimum floor for localities with populations of 25,000 or fewer. (law.lis.virginia.gov)

Localities may adopt higher thresholds, lower tax rates, additional exemptions, or decisions not to tax particular business classifications. The state thresholds are therefore minimum protections for the covered localities rather than the only thresholds that can apply.

Why BPOL Catches Businesses Off Guard

When the gross-receipts tax applies, BPOL is generally based on gross receipts rather than net profit.

That means a business above the applicable threshold can owe BPOL during a year in which margins are thin, taxable income is low, or the business reports a loss. Expenses that reduce federal or Virginia taxable income generally do not reduce gross receipts for BPOL purposes.

A smaller business may be protected from the gross-receipts tax by the statutory or local threshold but may still owe a flat license fee. The result depends on the locality’s population, ordinance, classifications, exemptions, and receipt levels.

Virginia law also permits a locality to adopt an exemption from license fees or license taxes for businesses that have no after-tax profit and submit the applicable income-tax return as proof. That exemption applies only if the locality has enacted it. (law.lis.virginia.gov)

Multi-State Income Tax and Multi-Locality BPOL Issues

Businesses operating in multiple jurisdictions need to distinguish between two separate sourcing systems:

Virginia income-tax allocation and apportionment determine how much business income is treated as Virginia-source income.
BPOL situs rules determine which Virginia locality may tax particular gross receipts.

For Virginia income-tax purposes, a business operating both inside and outside Virginia generally must divide its income between jurisdictions rather than assume that all income is taxable by Virginia. Multistate corporations report this calculation on Schedule 500A. Under Virginia’s general corporate formula, apportionable income is multiplied by a factor based on Virginia property, payroll, and double-weighted sales, although manufacturers, retailers, financial corporations, and certain other industries may use different formulas. (tax.virginia.gov) (law.lis.virginia.gov)

Pass-through entities also use Virginia’s allocation and apportionment rules to determine the portion of income treated as Virginia-source income for nonresident owners. A Virginia resident owner is generally taxed by Virginia on income from all sources but may qualify for a credit when the same income is taxed by another state. A nonresident owner is generally taxed by Virginia only on the owner’s share of Virginia-source income. (tax.virginia.gov) (tax.virginia.gov)

Apportionment does not necessarily mean the business owes tax in only one state. Employees, property, sales, services, or other business activity in another state may create filing obligations there, while Virginia’s apportionment rules determine how much of the business’s income remains taxable by Virginia.

BPOL uses a different system. Gross receipts generally are attributed to the business’s definite place of business under rules that vary with the type of activity. A definite place of business generally means an office or other location where the business maintains a regular and continuous course of dealing for at least 30 consecutive days. A residence can also qualify when the person has no definite place of business elsewhere. (law.lis.virginia.gov)

A business with definite places of business in multiple Virginia localities may need to attribute receipts among those locations. Merely having customers in another locality generally does not, by itself, give that locality the right to impose BPOL on the receipts. For service revenue, receipts generally are attributed to the definite place of business where the services are performed or, if they are not performed at a definite place of business, to the location from which the services are directed or controlled. (law.lis.virginia.gov)

The rules differ for contractors, retailers, wholesalers, service businesses, and other classifications. Businesses with remote employees, multiple offices, customers in several states, or operations outside Virginia should separately evaluate state income-tax nexus and apportionment and Virginia local BPOL situs rather than assuming all income and receipts belong to the headquarters location.

Virginia SCC Requirements: Fees and Reports

The Virginia State Corporation Commission handles entity registration and maintenance. These requirements are separate from Virginia income-tax filings and local BPOL returns.

Do Virginia LLCs File an Annual Report?

Generally, no. Virginia LLCs normally pay a $50 annual registration fee but do not file an annual report.

The fee is due by the last day of the month in which the LLC was formed or registered to transact business in Virginia. If the payment is late, the SCC imposes a $25 penalty. A domestic LLC’s existence may be automatically canceled if the fee remains unpaid through the last day of the third month following the due date. (scc.virginia.gov)

What About Corporations?

Virginia stock corporations generally must file an annual report and pay an annual registration fee.

There is no fee for filing the annual report itself. The annual registration fee ranges from $100 to $1,700 based on the number of shares the corporation is authorized to issue. A corporation authorized to issue between one and 5,000 shares generally pays $100, while a corporation authorized to issue more than 270,000 shares generally pays $1,700. (scc.virginia.gov)

Both the annual report and registration fee generally are due by the last day of the corporation’s incorporation or Virginia registration anniversary month. (scc.virginia.gov)

What Happens if You Miss SCC Deadlines?

Missing an SCC filing or payment can result in:

Late-payment penalties
Loss of good standing
Cancellation of an LLC
Termination of a domestic corporation
Revocation of a foreign entity’s authority to transact business in Virginia

A Virginia corporation may be automatically terminated, or a foreign corporation’s authority may be revoked, if its annual report or registration fee remains outstanding through the last day of the fourth month after the due date. (scc.virginia.gov)

These consequences can create problems that are much larger than the underlying fee. A canceled or terminated entity may encounter difficulties with financing, licensing, contracts, lawsuits, insurance coverage, and reinstatement. For a broader discussion, see the “Legal and Insurance Risks of Improper Registration” section of our article Avoiding State Income Tax by Registering Elsewhere? What Actually Works (and What Doesn’t).

Virginia Business Tax Compliance Calendar

Here are the primary deadlines many Virginia business owners need to track:

Form 500 for a calendar-year C-Corp: April 15
Form 502 or Form 502PTET for a calendar-year pass-through entity: April 15
Virginia Form 760 for a calendar-year individual: May 1
Corporate estimated tax payments: April 15, June 15, September 15, and December 15 for a calendar-year corporation when expected Virginia tax exceeds $1,000
PTET estimated payments: April 15, June 15, September 15, and December 15 for a calendar-year entity when expected PTET exceeds $1,000
Individual estimated tax payments: May 1, June 15, September 15, and January 15 of the following year when expected Virginia tax after withholding and credits exceeds $1,000
BPOL annual application or renewal: Date established by the locality between March 1 and May 1
Virginia LLC annual registration fee: Last day of the LLC’s anniversary month
Corporate annual report and registration fee: Last day of the corporation’s anniversary month

Beginning with taxable years on or after January 1, 2026, the individual estimated-tax threshold increased from $150 to more than $1,000. Virginia’s first individual estimated payment is due May 1 rather than the April 15 federal estimated-payment date. (tax.virginia.gov)

Calendar-year Form 502 and Form 502PTET returns are generally due April 15 rather than March 15. Virginia’s pass-through return deadline therefore differs from the standard federal deadline for calendar-year partnerships and S-Corps. (tax.virginia.gov)

Local governments must establish a BPOL application deadline between March 1 and May 1. The exact filing and payment dates should be confirmed with the applicable city, county, or town because the state does not impose one uniform March 1 deadline for every locality. (law.lis.virginia.gov)

Common Mistakes Virginia Business Owners Make

The most common Virginia business-tax mistakes are predictable:

Assuming every LLC has the same tax treatment
Confusing Virginia income tax with local BPOL
Forgetting that a gross-receipts tax may apply even when the business is not profitable
Assuming every business is subject to BPOL tax from its first dollar of revenue
Using the federal March 15 deadline for Virginia Form 502
Using the federal April 15 date for the first Virginia individual estimated payment
Missing corporate, individual, or PTET estimated-tax requirements
Assuming every federal deduction produces the same Virginia deduction
Treating SCC fees as part of the Virginia income-tax return process
Assuming customers in another locality automatically create BPOL liability there
Ignoring Virginia withholding requirements for nonresident owners
Confusing a permanent PTET law with a permanent entity election
Failing to consider multi-state nexus, apportionment, and owner-residency issues

The practical starting point is to identify which agency is involved, what tax base it uses, which return or form applies, and when the particular obligation is due.

Final Thoughts

Virginia business taxes are not one filing, one rate, or one agency.

A C-Corp may pay 6% corporate income tax. A pass-through entity may shift income to its owners or elect PTET. A locality may impose BPOL on gross receipts above the applicable thresholds or charge a business-license fee. The SCC may require an annual fee, annual report, or both.

The correct result depends on the business’s legal entity, federal tax classification, ownership, locations, income sources, and applicable local ordinance. Treating those obligations as separate systems makes it much easier to determine what applies and avoid missed filings, penalties, and unexpected tax bills.

FAQ: Virginia Business Tax Rates

What Is Virginia’s Corporate Income Tax Rate in 2026?

Virginia’s corporate income-tax rate is generally 6% of Virginia taxable income for corporations subject to the tax. (tax.virginia.gov)

The 6% rate applies to taxable income rather than gross receipts. A multistate corporation may also need to allocate and apportion income before calculating the Virginia tax.

Virginia taxable income may differ from federal taxable income because Virginia does not conform to every federal deduction or expensing provision. (tax.virginia.gov)

How Is a Single-Member LLC Taxed in Virginia?

A single-member LLC is generally taxed based on its federal classification.

When the LLC is disregarded for federal tax purposes, its income generally passes through to the owner’s Virginia return, and the LLC normally does not file Form 502. An LLC that elects S-Corp or C-Corp treatment follows the Virginia rules applicable to that classification. (irs.gov)

How Are Multi-Member LLCs and Partnerships Taxed in Virginia?

Multi-member LLCs taxed as partnerships and other partnerships generally are pass-through entities.

The entity files the applicable Virginia pass-through return, while its income generally is taxed to the owners based on their residency, tax classification, and share of Virginia-source income. The entity may also elect PTET for qualifying income attributable to eligible owners. (tax.virginia.gov)

How Is an S-Corp Taxed in Virginia?

An S-Corp generally is treated as a pass-through entity for Virginia income-tax purposes. Its income passes through to the shareholders, although the entity may elect to pay Virginia PTET on income attributable to eligible owners. (tax.virginia.gov)

An S-Corp may legally be organized as a corporation or LLC. The S election is a federal tax classification rather than a separate type of Virginia legal entity. (irs.gov)

Do I Owe BPOL Tax Even if My LLC Didn’t Make a Profit?

Possibly.

When the BPOL gross-receipts tax applies, deductible expenses and operating losses generally do not eliminate it because the tax is based on gross receipts rather than net profit.

However, smaller businesses may fall below a state-mandated or locally adopted gross-receipts threshold. In localities with more than 50,000 residents, the gross-receipts tax generally cannot be imposed on businesses with less than $100,000 of receipts. In localities with populations between 25,000 and 50,000, the state-law floor is $50,000. A business below the applicable threshold may still owe a local license fee. (law.lis.virginia.gov)

The result depends on the locality’s population, ordinance, thresholds, classifications, exemptions, and situs rules.

Is BPOL the Same as Virginia State Income Tax?

No.

BPOL is a local business-license tax or fee imposed by a city, county, or town. Virginia state income tax is administered by Virginia Tax and generally is based on taxable income rather than gross receipts.

A business may owe both.

What Is the Difference Between Virginia Corporate Tax and PTET?

Virginia corporate income tax generally applies to C-Corps at a flat 6% rate. (tax.virginia.gov)

PTET is an elective entity-level tax for qualifying pass-through entities. It is imposed at 5.75% on income attributable to eligible owners, who generally receive refundable credits for their shares of the PTET paid. (tax.virginia.gov)

Is the Virginia PTET Election Permanent?

No.

Virginia’s authorization for PTET is permanent under current law, but an entity makes a separate election for each taxable year. Filing Form 502PTET binds the entity and its eligible owners for that particular year. (tax.virginia.gov) (tax.virginia.gov)

When Are Virginia Individual Estimated Taxes Due?

For a calendar-year taxpayer, Virginia individual estimated payments are generally due May 1, June 15, September 15, and January 15 of the following year.

Beginning in 2026, estimated payments generally are required when expected Virginia income tax after withholding and allowable credits exceeds $1,000. (tax.virginia.gov)

When Is Virginia BPOL Tax Due?

The annual BPOL application or renewal deadline is set by the locality and must fall between March 1 and May 1.

March 1 is common, but it is not universal. The locality may also establish a separate payment date, and new businesses may have to register before beginning operations. (law.lis.virginia.gov)

Does a Virginia LLC File an Annual Report?

Generally, no.

A Virginia LLC typically pays a $50 annual registration fee to the SCC but does not file an annual report. Virginia corporations generally file annual reports and pay registration fees under separate rules. (scc.virginia.gov)

Which Entity Structure Is Right for My Virginia Business?

That depends on more than the lowest Virginia tax rate.

The analysis should consider liability protection, federal and state tax treatment, payroll requirements, self-employment tax, reasonable compensation, administrative costs, ownership structure, future investors, distributions, exit plans, and where the owners and business operate.

A structure that produces a lower tax rate in one category may create additional payroll costs, compliance requirements, or taxes elsewhere.