Registering a business in New Hampshire
All businesses operating in the State of New Hampshire are required to register with the New Hampshire Secretary of State. Some businesses may also be required to register with the New Hampshire Department of Revenue Administration. New Hampshire offers an online business registration online found here.
S-Corporation Income Tax
New Hampshire does not recognize the federal S corporation election, and instead treats S corporations like a traditional C corporation. This includes taxing the business’ income with the business profits tax, as well as being subject to New Hampshire’s “Business Enterprise Tax” explained below.
S-corporation income is taxed at a flat rate of 7.7%. Unlike most states, S corporation shareholders do not have to put their share of the S-corporation on their personal New Hampshire income tax return
LLC/Partnership Income Tax
New Hampshire does not recognize the pass-through nature of LLCs and partnerships. Instead, they are both subject to New Hampshire’s income tax of 7.7%. Unlike most states, LLC members and partnership partners do not have to pay New Hampshire income tax from their share of the company’s New Hampshire income. LLCs and partnerships are also subject to the “Business Enterprise Tax” , explained below.
Business Enterprise Tax
The business enterprise tax is based on a business’s “enterprise value tax base.” This is defined by the Department of Revenue Administration as “the sum of all compensation paid or accrued, interest paid or accrued, and dividends paid by the business enterprise, before special adjustments and apportionment.” The BET rate is 0.6%. A business is required to file a BET return if either:
Its enterprise value tax base is more than $108,000; or
It has more than $217,000 of gross business receipts.
Business Profits Tax
The business profits tax is a tax that is levied on all businesses in New Hampshire and functions much in the same way that corporate income tax is levied in other states. The Business Profits Tax is enforced at a rate of 7.7%. Businesses are required to file the a Business Profits Tax return if their gross receipts from all activities are over $50,000.
Individual Income Tax
New Hampshire does not impose a tax on individual income and therefore, individuals are not required to file a tax return.
Business Enterprise Tax and Business Profits Tax returns are both due on the 15th day of the third month following the end of the tax year for partnerships, and the 15th day of the fourth month following the end of the tax year for proprietorships and corporations.
Every entity required to file a Business Profits Tax return and/or a Business Enterprise Tax return must also make quarterly estimated tax payments for each individual tax for its subsequent taxable period, unless the ANNUAL estimated tax for the subsequent taxable period is less than $200 for Business Profits Tax and $260 for Business Enterprise Tax.
However, if at the end of any quarter the estimated tax for the year exceeds $200 for Business Profits Tax or $260 for Business Enterprise Tax, an estimated tax payment must be filed.
Filing An Extension
Businesses requesting an extension to file a Business Profits or Business Enterprise Tax return, are not required to file an application for an automatic 7-month extension of time to file provided that the taxpayer has paid 100% of both the BET and the BPT determined to be due by the due date of the tax.
A taxpayer failing to timely file a complete return may be subject to a penalty equal to 5% of the tax due or $10, whichever is greater, for each month or part thereof that the return remains unfiled or incomplete. The total amount of this penalty shall not exceed 25% of the balance of tax due or $50, whichever is greater.
If your business was formed or is located in another state, but generates income in New Hampshire, it may be subject to New Hampshire taxes. The rules for taxation of multistate businesses, including what constitutes nexus with a state for the purpose of various taxes, are complicated. If you run such a business, you should consult with a tax professional.
New Hampshire Secretary of State:
New Hampshire Department of Revenue Administration: