There are a few different options when it comes to forming a business in Virginia. From a legal perspective, there are three main types of Virginia for-profit business entities: LLCs, S Corporations or C Corporations. For many entrepreneurs, we believe an LLC provides the right mix of liability protection and ease of administration.
In order to create an LLC in the state of Virginia, there are some minimum requirements you must meet. These are a completed set of Articles of Organization, a business name and a fee you pay to the Virginia State Corporation Commission. We recommend taking some other steps before formally starting your LLC:
- Research your target market to make sure there’s a demand for the products and services you provide.
- Read industry guides to give you a starting point in your niche.
- Create a comprehensive business plan that defines the most important aspects of your Virginia business.
- Write an Operating Agreement that covers how you will run your LLC.
After you’ve created your Virginia LLC, you will also need to review your business license requirements, understand ongoing filing needs, set up a separate business bank account and get an accountant.
In Virginia, you register a business by completing and filing your Articles of Organization with the Virginia State Corporation Commission. You will need to gather information about your business, fill out the form and send it to the State Corporation Commission with your filing fee. This will formally create your LLC in Virginia.
You can file your Articles of Organization on the State Corporation Commission website or mail it in. Alternatively, Incfile can guide you through every step of the process by getting details from you and filing the form on your behalf — for free! There’s no additional charge for our basic LLC filing service, so all you need to do is pay the Virginia state filing fee.
At the time of writing the fee charged by the Virginia State Corporation Commission is $100. You can always check the latest Virginia filing fees here. You can also pay an additional $100 or $200 for expedited filing through Incfile, which will create your LLC faster. The amount of the expedited fee is dependent on how quickly you want your filing processed. Some LLC filing services do charge you extra to prepare and submit your filing documents, but at Incfile, we do this for free — so you only pay the state fee.
Once you’ve gathered all of your information together and filed your Articles of Organization (or had Incfile do it for you), it can take up to a week for the Virginia State Corporation Commission to legally form your LLC. If you pay an additional $100 or $200 expedited fee, your LLC can be created the next day or same day, respectively.
There are a few ways to register your Virginia LLC name.
- If you’re forming a new business and your business name is unique in Virginia and meets state naming rules, you simply include it in your Articles of Organization.
- If you want to change the legal name of your business, file Articles of Amendment with the State Corporation Commission.
- If you just want to do business under a different name, file a Certificate of Assumed or Fictitious Name with the Virginia State Corporation Commission, or have Incfile do it on your behalf.
If you want to prevent people from using your business name across the U.S., you can file a trademark for the name. We can help.
In many other states, the formal documents that you file to form a corporation or LLC might be known as Articles of Incorporation. In Virginia, this document is called your Articles of Organization, and it performs the same functions as the Articles of Incorporation.
Yes, as of recently (2020) the State of Virginia allows the formation of a Series LLC within the state. A Series LLC is a special type of LLC where you create one “overall” business and then have individual, series LLCs within it, each counted as separate legal entities.
To form a Series LLC, you'll have to file a Statement of Protected Series Designation form and file it with the State Corporation Commission. The fee for a Series LLC formation is $100.
If you want to change your Virginia Registered Agent you can do so online by using the Clerk's Information System on the State Corporation Commission website. Here at Incfile, we provide a free Virginia Registered Agent service for the first year if you file through us. If you’ve been using a different Registered Agent and want to switch to us, we’ll file the Statement of Change on your behalf.
If you need to know the Registered Agent of a specific Virginia business, you can perform a Virginia Registered Agent search within the state's business database.
As an LLC, any business profits you earn will be reported on your personal 1040 filing and reported and taxed as “pass-through” income. You will typically need to pay:
- Self-employment or payroll tax on all business profits
- Federal income tax on profits after you meet your tax-free allowance
- Sales tax for selling taxable products and services
Virginia charges a 5.3 percent state sales and use tax on all retail sales, leases and rentals of most goods. In general, all sales, leases, and rentals of tangible personal property in or for use in Virginia, as well as accommodations and certain taxable services, are subject to Virginia sales and use tax, unless an exemption or exception is established.. You can find a helpful list of exemptions and exceptions here.
You will need to register your business with the Virginia Department of Taxation. You can complete this process online.
The base rate for Virginia sales tax is 5.3 percent, and there may be additional sales tax depending on your region, county or city. Once you know your overall sales tax amount, calculate the value of all your taxable products and services. Then, multiply that by your sales tax rate to understand how much you will need to pay.
You can use the VA Department of Taxation sales tax rate lookup tool to determine the rate in your area.
Once your LLC’s sales tax registration is complete, you will receive a notice with instructions on how often you must file a sales tax return and pay sales taxes. Returns and payments may be due monthly, quarterly or annually.
In Virginia, a franchise tax is only imposed on the net capital of banks and trust companies. Corporations that aren't banks or trust companies, are not subject to a franchise tax, however they are still required to pay corporate income tax. LLCs or pass-through entities aren't required to pay corporation income tax.
That said, pass-through entities (such as LLCs) in Virginia can now elect to be taxed at the entity level on their income. To do this, refer to the filing instructions provided by the Virginia Department of Taxation.
If you wish to own and operate a business in Virginia, you'll likely need a business license of some kind to maintain compliance. The types of business licenses you need will vary depending on your type of business, industry, location and various other factors. We can research the types of business licenses you might need for you.