What taxes apply to a new small business?

Taxes for New Small Businesses in West Virginia

Starting a small business in West Virginia involves understanding several key tax obligations. Proper tax planning ensures compliance and smooth business operations.

State Taxes Applicable to Small Businesses

• West Virginia Business and Occupation (B&O) Tax: This is a gross receipts tax imposed on certain types of businesses. Rates vary by industry, so determine your classification early.
• Personal Income Tax Withholding: If you hire employees, you must withhold state income taxes from their wages and remit them to the West Virginia State Tax Department.
• State Sales and Use Tax: Businesses selling tangible personal property or certain services must collect and remit a 6% state sales tax, plus any applicable local taxes.
• Corporate Net Income Tax: If your business is structured as a corporation, you will be subject to West Virginia’s corporate net income tax on profits.
• Unemployment Insurance Tax: Employers must pay unemployment insurance taxes to the West Virginia Division of Unemployment Compensation.

Other Tax Considerations

• Local Taxes: Some municipalities may impose additional business taxes or fees. Check with local city or county offices for requirements.
• Federal Taxes: Remember to register for an Employer Identification Number (EIN) with the IRS and comply with federal payroll and income tax requirements.
• Recordkeeping: Maintain accurate records of all tax filings, payments, and employee payroll to streamline compliance and reporting.

As of 2026, tax rates and filing requirements may change, so regularly consult the West Virginia State Tax Department website and consider working with a tax professional to stay current.