A General Excise Tax (GET) license is required if you want to launch a small business in Hawaii or on Oahu. Regardless of size or industry, this license is necessary for all companies that sell products or services within the state. We’ll explain what the GE Tax License is in this article, why it’s important, and how to get one.
In Hawaii, there is a tax on commercial activities called the General Excise Tax (GET). Though there are a few significant variances, it is comparable to other states’ sales taxes. First off, the GET does not only apply to sales of physical items; it also covers services, rentals, commissions, and other commercial endeavors. Second, the GET is not a set percentage; rather, it fluctuates based on the type of business and the area. On Oahu, for instance, the average GET rate is 4.5%, but it can vary widely depending on the transaction—it may be as high as 0.5% for wholesale deals or as low as 0.15% for specific food items.
Businesses must apply for a GE Tax License with the Hawaii Department of Taxation in order to pay the GET. This permission essentially allows you to run a business in the state and collect taxes on the government’s behalf. Businesses in Hawaii are not permitted to sell products or services without a current GE Tax License.
A GE Tax License can be obtained through a rather simple process. The basic steps are as follows:
1. Select a location and activity for your business. The GET rate fluctuates in accordance with various parameters, as was previously noted. The website of the Hawaii Department of Taxation has a comprehensive list of rates. 2. Apply for a Hawaii tax identification number. You can do this by mail using Form BB-1 or online through the Department of Taxation’s website. 3. Submit a GE Tax License application. You can do this by mail using Form BB-1 or online through the Department of Taxation’s website. 4. Await authorization. Application processing times for GE Tax Licenses vary, however they usually take a few weeks. You’ll get a certificate if your application is accepted, which you can put up in your place of business. Is it possible to register a business name without using it?
Yes, it is possible to register a business name in Hawaii even if you don’t use it for commercial purposes. A “reserved name” enables you to reserve a certain business name for up to 120 days without actually launching a company. If you’re still in the planning stages of your company and want to reserve a name before someone else does, this can be helpful.
You must submit a Name Reservation Request to the Hawaii Department of Commerce and Consumer Affairs (DCCA) in order to reserve a name. The reservation period is 120 days long and costs $10 for this service. You’ll need to submit more paperwork to register the name with the DCCA if you choose to use it for your company.
In conclusion, it’s critical to comprehend the prerequisites for obtaining a GE Tax License if you intend to launch a small business on Oahu or anywhere in Hawaii. You may make sure that your company is in conformity with state tax rules and avert potential penalties or fines by following the above-described measures. Additionally, keep in mind that you can reserve a business name even if you haven’t yet launched your venture if you’re still in the planning stages.