Your business may have tax obligations to the federal government, the Commonwealth of Virginia and Fairfax County. Please consult a tax specialist to determine what your obligations are. Refer to Step 1: Plan and Research for business counselors who can help you understand these requirements and connect you to resources.
Most businesses need an Employer Identification Number (EIN), also known as a Federal Tax Identification Number, which is used to identify a business entity. EINs are issued by the IRS.
Sales tax is reported and paid to the Commonwealth of Virginia.
Virginia cities and counties levy a 1 percent sales and use tax.
Localities that make up both the Northern Virginia, which includes Fairfax County, and Hampton Roads regions levy an additional 0.7 percent sales and use tax for transportation. This tax is collected at the point of sale and at the same time as the state's 4.3 percent sales and use tax, for a total of 6.0 percent.
The Virginia Department of Taxation uses Federal Information Processing Standards (FIPS) codes to identify where a business is located and where their sales take place. FIPS codes are a standardized set of numeric codes to ensure uniform identification of geographic entities such as cities, counties, and towns. Use the Virginia Department of Taxation's FIPS Lookup tool to determine your correct code.
File for BPOL within 75 days of beginning operations in Fairfax County. Failure to register within 75 days will result in a 10% late filing penalty. Businesses registered with DTA in the previous year will receive a renewal application in the mail each January.
Obtaining your official BPOL license can take 4-6 weeks. For Fairfax County’s purposes, the receipt that you have filed is sufficient to meet the requirement. If you need a temporary BPOL certificate, contact the Department of Tax Administration at 703-222-8234, Option 4, or DTAPPDBusiness@fairfaxcounty.gov.
Business owners must renew their BPOL License each year.
File & Pay BPOL Tax
BPOL is an annual tax, based on the gross receipts of your business. You do not have to pay BPOL taxes until the company gross receipts are greater than $10,000 within a calendar year, but you should not wait to reach that threshold before you get your BPOL license.
Your Fairfax County business tax obligations will vary based on business type:
Businesses located in the cities of Fairfax, and Falls Church, and the towns of Clifton, Herndon, and Vienna (except construction contractors with contracts in Fairfax County) are not subject to Fairfax County's BPOL tax, but you should contact those jurisdictions for business license requirements.
Businesses located in the towns of Clifton, Herndon and Vienna secure a business license from the appropriate town and pay Business Tangible Property Tax to Fairfax County.
If your business is home-based, you do not need to fill out the information about rent on the BPOL application.
Certain business types are required to provide licensing requirements before a BPOL license will be issued. These businesses include:
Architects and Engineers
Builders, Developers, and Construction Contractors (to include landscaping contractors and painters)
Certain businesses are required to collect taxes to be remitted to Fairfax County. This is not sales tax, which is remitted to the Commonwealth of Virginia. Locally-collected taxes include:
Short-term Daily Rental Tax - levied on all tangible personal property (except daily rental of passenger vehicles) held for rental and owned by a person engaged in the short-term rental business (Code of Virginia, §58.1-3510.6). This tax does not include rental dwellings also known as short-term property rental or short-term lodging (STL).
Transient Occupancy Tax - levied on any public or private hotel, inn, apartment hotel, hostelry, tourist home or house, motel, rooming house, that offers Short-Term Lodging as defined in the Fairfax County Zoning Ordinance, or other lodging place within the County offering lodging for one or more persons at any one time, and the owner and operator thereof, who, for compensation, furnishes lodging to any transients, rented out for continuous occupancy for less than 30 consecutive days.
This tax applies to any tangible property - including computers, furniture, equipment, machinery and tools - located in Fairfax County on January 1 each year. If you have questions about what is taxable, please contact the Department of Tax Administration (703-222-8234 or DTAPPDBusiness@fairfaxcounty.gov).
Businesses located in the towns of Clifton, Herndon and Vienna secure a business license from the appropriate town, but pay Business Tangible Property Tax to Fairfax County.
Filing is due by May 1; Payment is due by October 5.