Steps to Pay Your New Hampshire Small Business Taxes
Most small business owners in New Hampshire know how important it is to pay their federal, local, and state taxes. Paying these taxes fully and on-time is an essential part of making sure your business remains legally compliant. But knowing exactly what taxes you need to pay and when can cause anxiety for even the most experienced small business owners. That’s why we’ve developed this short guide to assist business owners in learning what kinds of state taxes a New Hampshire business owner might face, how and when to pay them, and which of our products and services can make the process easier.
If you need more complete legal compliance help, check out our Worry-Free Compliance service, which keeps your business documents organized and can help keep you on track with required business filings such as annual reports.
Step 1: Establish your New Hampshire business’s corporate income tax obligations
Tax rates on both the federal and state levels depend on a business’s entity structure. Small business owners who are sole proprietors or own other pass-through entities, such as limited liability companies (LLCs), pay taxes on business income through their personal tax returns. The business income “passes through” the company to the owner.
On the other hand, corporate income is taxed twice. A corporation pays corporate income taxes on the income the company generates. Then shareholders pay personal income taxes on dividends the company pays to the owners. Thus, the first step in paying business taxes in New Hampshire is determining how the state taxes corporate income.
New Hampshire requires businesses to pay a business enterprise tax (BET) and business profits tax (BPT). The BET is a tax on business income, while the BPT is a tax on the business’s enterprise value tax base.
New Hampshire Business Profits Tax
All for-profit businesses in New Hampshire are subject to the Business Profits Tax or BPT. However, if your business has $50,000 or less in gross business income, you’re not required to file a tax return. That threshold increases to $92,000, beginning with tax years ending on December 31, 2022.
BPT tax returns are due on the 15th day of the third month following the end of the company’s taxable year. Corporate tax returns are due on the 15th day of the fourth month after the tax period ends.
Most companies are required to pay estimated business taxes in New Hampshire at a rate of 25% of the estimated tax liability if their tax liability is more than $200. The due dates are the 15th day of the fourth, sixth, ninth, and twelfth month of the corporate tax period.
Business Enterprise Tax
The Business Enterprise Tax or BET is a flat-rate tax on a company’s enterprise value tax base. The enterprise value tax base is the total of all compensation and interest paid or accrued and dividends paid during the tax period after special apportionments and adjustments.
The New Hampshire business tax rate for BET is 0.6% for taxable periods ending on or after December 31, 2019. The New Hampshire business tax rate for BET is 0.55% for tax periods ending on or after December 31, 2022.
According to the New Hampshire Department of Revenue, businesses with $222,000 or more in gross receipts or $111,000 or more for an enterprise value tax base must pay the Business Enterprise Tax.
The BET tax return is due on the 15th day of the third month after the end of the taxable period. Corporate tax returns are due by the 15th day of the fourth month after the taxable period ends.
Companies are required to make estimated payments if their tax liability is greater than $260. Four payments of 25% of the estimated tax liability are paid on the 15th day of the fourth, sixth, ninth, and twelfth months of the taxable period.
Step 2: Determine your New Hampshire business’s employment taxes
Most states impose state income taxes on wages earned within the state. Businesses withhold income taxes from an employee’s payroll each pay period. The business submits withholding or employment taxes each month or quarter, depending on the amount of withholding taxes for the period. At the end of the tax period, the business files a state employment tax return.
However, employees in New Hampshire aren’t subject to state employment taxes on wages and salaries. Therefore, New Hampshire small business taxes don’t include employment taxes.
Step 3: Establish your New Hampshire business’s additional state tax obligations
In addition to the above taxes, a New Hampshire small business may owe other types of taxes. Below are common taxes that small businesses may owe.
Many states impose a tax on goods sold within the state. The sales tax is generally a flat rate collected by the seller and paid to the state. The due dates for sales tax vary by state.
There is no general sales tax charged on goods purchased in New Hampshire.
Franchise or Privilege Tax
A franchise or privilege tax is typically a flat rate fee for doing business within a state. Many states charge these taxes on corporations and other businesses in addition to taxes on the corporation’s income.
There is no business franchise or privilege tax in New Hampshire.
If a small business employs workers, it pays state unemployment taxes. Employers file a Tax and Wage Report for each quarter to report wage information for all company employees. The amount of taxable wages paid is the basis for calculating unemployment taxes. As of 2021, the New Hampshire new employer tax rate is 2.7% of the taxable wages paid to employees.
Many states charge an excise tax on specific goods sold within the state. For example, New Hampshire charges excise tax on several types of goods. A small business collects the excise tax on the sale of those goods and remits the taxes to the state.
For example, the state charges a flat tax on the sale of all tobacco products other than premium cigars sold to consumers within the state. Therefore, it’s the responsibility of small business owners to know which products they sell have an excise tax.
Step 4: Prepare to file and pay your New Hampshire small business taxes
The New Hampshire Department of Revenue Administration collects most types of small business taxes in New Hampshire. You can e-file and pay taxes online through their e-file New Hampshire website. The New Hampshire Employment Security office collects unemployment taxes. A company files returns and pays taxes online through the New Hampshire Internet Unemployment Tax and Wage Report & New Hire Reporting System.
An important step in learning how to file small business taxes in New Hampshire is gathering information needed to prepare returns. Information needed to prepare and file tax returns includes, but is not limited to:
- Invoices and receipts
- Bank statements
- Income statements
- Balance sheet
- Sales report
- Employment records
- Credit card statements
Having a system that tracks invoices and manages business finances is essential to ensure compliance with tax laws and regulations. Our ZenBusiness Money App allows you to track income and expenses to manage your business finances to take the stress out of preparing small business tax returns.
Do I need an accountant?
Many small business owners benefit from having professional accounting help. Accounting errors and mistakes can result in expensive fines and penalties when you file business tax returns. The Internal Revenue Service provides a guide to tax return preparer credentials and qualifications to help small business owners choose a qualified accountant for this business.
If you’re looking for information about federal taxes, head over to our page on federal taxes for small businesses to learn more.
How we can help
Managing your own New Hampshire business takes an extraordinary amount of hard work and dedication. With so much on your plate already, worrying about your taxes can make things feel even more complicated. But we are here to help with the ZenBusiness Money App. The app allows you to easily send custom invoices, accept credit card and bank transfer payments, and manage your clients from an easy-to-use dashboard.
We also have tips for small business owners and tax information on our website. Learn about self-employment deductions, tax deductibles for startup expenses, and LLC tax information by browsing our library of articles.
No matter what size your business is or what stage, we have the tools you need to help your business succeed.
Disclaimer: The content on this page is for information purposes only, and does not constitute legal, tax, or accounting advice. If you have specific questions about any of these topics, seek the counsel of a licensed professional.
- How much can a New Hampshire small business make before paying taxes?
Small businesses pay business profit tax (BPT) on all gross income generated during the tax period. Businesses pay business enterprise tax (BET) when they have $222,000 or more in gross receipts or $111,000 or more for an enterprise value tax base.
- What percentage does a New Hampshire small business pay in taxes?
The New Hampshire business tax rate for BET is 0.60% for taxable periods ending on or after December 31, 2019. The New Hampshire business tax rate for BET is 0.55% for tax periods ending on or after December 31, 2022.
The BPT tax rate for taxable periods ending December 31, 2021, is 7.7%. The BPT tax rate for taxable periods ending December 31, 2022, is 7.6%.
- How does a New Hampshire small business pay taxes?
Taxes are paid online through the New Hampshire Department of Revenue. Unemployment taxes are paid online through the New Hampshire Employment Security office.
- Do I have to file taxes for my small business in New Hampshire?
Most small businesses in New Hampshire are subject to one or more business taxes. As discussed above, all companies are subject to the state Business Profit Tax and Business Enterprise Tax. In addition, a small business with employees pays unemployment taxes.
Failing to file business tax returns and pay taxes results in fines and other penalties.